Everything You Should Know About Group Health Insurance

As per the current norms of the Insurance Regulatory and Development Authority of India (IRDAI) circular released on 15th April 2021, it mandates the employers of the country to provide corporate health insurance plans to their employees.

However, even before that, employers were offering group health insurance plans to improve employee retention, financially protect them from serious health issues and ensure their mental well-being.

Also read: How a Personal Disability Insurance Affects Your Life?

On the other hand, as employees, it is also crucial for them to know the nitty-gritty of this health cover in detail.

Let’s explore the ins and outs of this health insurance plan.

What Is Group Health Insurance?

As the name suggests, this particular health insurance is available for a group of people from the same organization. Usually, the respective insurer issues a single protection plan in the name of that group or organization and is also known as Master Policy. The insured employees are covered under this policy.

However, the premium for this health insurance plan is paid by the employer. In some cases, this health plan also covers the family members of the employees insured.

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With this plan in place, you can ascertain that the insurer will take care of the expensive medical bills in case of any health emergency.

How Do Group Health Insurance Plans Work?

A health insurance plan works almost the same as a standard insurance plan. However, the following are some pointers you need to know about a corporate health insurance plan:

  • Since a single insurance plan covers multiple people, the premium paid is lower than an individual health insurance plan.
  • In some cases, the employees can also add their dependents like children and spouses to the plan. For other cases, they can also add their senior citizen parents by paying an additional premium amount.
  • Since this health insurance plan covers all the members of a group, the sum assured will be the same for every employee, irrespective of their financial standings.
  • The insured individuals can also take admission to network cashless hospitals and avoid the financial liability incurred on an account of hospitalization.
  • Usually, a minimum of 10 individuals is required to avail of this insurance plan.
  • There would be a single point of contact against this insurance plan.

However, depending on the type of group health insurance policy one is part of, the facilities may alter.

Also read: What are the advantages of keeping business insurance?

Types of Group Health Insurance Policy

Following are some popular types of group insurance plans available in India:

  • Group personal accident insurance policy: Like an individual health insurance plan, it also offers financial protection against the liability incurred during accidental injuries.
  • Group Superannuation or Pension insurance plan: It works as potent alternatives to popular retirement schemes such as EPF (Employee Provident Fund) and NPS (National Pension System). This insurance plan addresses the retirement needs of insured individuals.
  • Employee Deposit Linked Insurance (EDLI) plan: It is a part of EPF and the benefits depend on the contribution of employees towards PF.
  • Employee/workmen compensation insurance policy: Applicable for some selected sectors, employers offer this insurance plan for their workers. It covers the liability of employers on account of injuries or death of employees due to accidents during employment.
  • Group insurance for travel: It is a unique combination of accident, health and liability insurance plans. This insurance plan covers the loss of baggage, accidents, medical emergencies, and third-party liabilities.
  • Public liability insurance policy: This insurance plan is suitable for entities engaged in dealing with clients, agents, and the public. It covers third-party liabilities due to injury or property damage.

Note that each of these group insurance policies has unique benefits and exceptions that you need to consider.

Benefits of Group Health Insurance Policy

Following are the notable benefits of a group health insurance plan:

Comprehensive coverage on several health necessities

Under a group health insurance plan, the insured individuals can enjoy the following coverage:

  1. Accidental hospitalisation
  2. COVID-19 hospitalisation
  3. Illness-related hospitalization
  4. Critical illness cover
  5. Psychiatric benefit
  6. Daily hospital cash cover
  7. Maternity benefit

Depending on the insurer, the coverage may vary.

  • Easy claim settlement

Since most insurers streamlined the claim settlement with an online process, it becomes easier to get reimbursement against a group health insurance plan.

  • Low premium payment

As mentioned earlier, since a single insurance plan covers multiple employees of an organization, the premium is affordable, compared to an individual health insurance plan.

Besides these common ones, a group health insurance plan is beneficial for:

  • Tax benefits

The premium amount paid against a corporate health insurance plan is considered as ‘Profit in lieu of salary. It allows employers to claim tax benefits by showing the amount paid under business expenses in profit and loss accounts.

  • Better employee retention

A group health insurance plan provides financial security during health emergencies to employees and their families. It assures them that their employer cares for them. It ensures higher employee retention and reduces attrition rates.

  • Cost-effective

Since a group health insurance plan covers a large group of people, the risk of insurers reduces. It allows insurers to offer affordable premiums and employers can save significantly.

  • Covers family members

Employees benefit from a corporate health insurance policy as they do not need to purchase separate plans for family members. It covers almost all family members of employees as well.

  • No prerequisites

Unlike an individual health insurance plan, the insurer does not conduct health check-ups of every employee involved in this particular plan. Thus, it also includes coverage for pre-existing illnesses.

While the benefits of a corporate health insurance plan are abundant, several myths are also associated with it that need to be busted at once.

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Myths of group health insurance policy

Following are the most common myths of a corporate health insurance plan:

  1. It covers selected diseases

There is a misconception that a group health insurance plan does not cover several diseases or medical conditions which is not true. For instance, pre-existing diseases like Diabetes, COPD, Sleep Apnea, etc. are covered under corporate health insurance and it does not accompany waiting periods.

  1. Maternity coverage is not available

Again, a group health insurance plan offers maternity coverage and in some cases also covers the newborn baby. Thus, this statement is a myth as well.

  1. A corporate health insurance plan does not entail cashless facilities

Contrary to the myth mentioned above, leading insurance companies offer cashless hospitalization facilities to every insured employee at network hospitals.

  1. Claim settlement is complicated

Often people think that claim settlement is complicated and lengthy for a group health insurance plan. Whereas, in reality, the insured employees can make hassle-free, paperless claims online and instantly.

  1. Group health insurance plan is available only for large companies

In contrast to popular belief, a group health insurance policy is available for small groups with 10+ and 25+ members as well.

Now that the myths are busted and you have a fair idea about a group health insurance plan, you can leverage the best features of it without much hassle.

Why Is It Essential To Have Comprehensive Health Insurance Apart From Corporate Health Insurance?

Corporate health insurance coverage provides limited coverage to the employees of the company. In case of a critical illness or more than one person falling ill at the same time, this coverage may not be enough, and you may have to pay from your pocket.

On the other hand, a comprehensive health insurance policy is an insurance policy with a low deductible and high maximum coverage limits, which combines basic & major medical coverage.  The comprehensive policy is the most common insurance providing the best coverage with an affordable premium. This policy works according to your convenience covering most of the benefits.

It is advisable to review your advantages and opt for comprehensive health insurance rather than corporate insurance to ensure a complete package. Buying comprehensive health insurance is as easy as it can be purchased within minutes online.

Also Read – Some Truths of Car Insurance!

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