Is Workplace Group Health Insurance For Employees Enough?

Many companies offer workplace health insurance to attract and retain employees. In most cases, the health insurance covers only the employee, while some policies may include one or two family members of the employee. Most employees feel assured with the insurance plan provided by the employer and do not buy private health insurance .Also, rarely do employees compare the benefits of workplace health insurance with similar plans available in the market. Employees may be ignorant of the coverage and the clauses of the health insurance. Keeping in mind a comprehensive coverage that will compensate for the rising medical expenses , it’s prudent that you have a private plan for health insurance.

Limited coverage:

Employers may purchase health insurance in bulk with limited scope for customisation. For instance, if you have a family history of a particular disease, it may not be covered in your workplace health insurance. And if you are solely dependent on workplace health insurance, you may end up spending from your pocket for the treatment.Besides, the insurance may not have a comprehensive cover for day care expenses, OPD costs and other inpatient hospitalization charges. Also, your workplace health insurance may have co-pay clauses and room rent clauses. In the co-pay clauses, you will have to pay for your medical expenditures partly. As per the room rent clause, the insurance will cover hospital room rent only up to the specified limit.

Low coverage:

Most companies offer Rs. 1.5 lakhs to 2 lakhs sum assured in the workplace health insurance for employees. This amount will barely cover 20 % to 30% of the medical expenses in cases of major illnesses and longer hospital treatments. Also, you will be overburdened if your family member covered in this insurance, too, requires hospitalization in that same year.

Insurance termination after job resignation:

You will enjoy the insurance benefits as long as you are associated with the company. Your workplace health insurance will be terminated once you resign from the job. And if you have no private health insurance, then you will be without a medical cover till you secure a new job that may or may not offer health insurance.

Insurance termination post-retirement:

Your workplace health insurance will only provide coverage until your tenure. Once you retire from the company, the insurance will be terminated. And if you are entirely dependent on the company insurance, buying individual health insurance at the retirement age will be more expensive. The health insurances for senior citizens are stringent with more number of medical tests. These policies may have exclusions of pre-existing health conditions.

Coverage for the number of persons:

A health insurance plan is a protective cover for you and your family in case of medical emergencies. But if your workplace health insurance only covers you and not your dependents, the medical expenses of your dependents will be a financial burden. If you have senior dependents, who are usually vulnerable to illnesses, it will be impractical not to have an individual health insurance.

Policy change or discontinuation:

Workplace health insurance is a perk for the employees and not their right. At any given time, your employer can discontinue the policy. The employer is also free to introduce policy changes such as a reduction in sum assured or removing dependents from the insurance.To sum it up, workplace health insurance can cover your basic health expenses. It’s advisable to have additional health insurance that covers you and your family members for critical illnesses, surgical procedures and hospitalization. You can opt for a health plan that customizes the sum assured, the number of dependents covered, and the list of diseases included based on your family history. Besides, make sure you purchase health insurance at a young age when you can avail comprehensive cover at lower premiums.

Health insurance is crucial to get financial protection against medical expenses. While you can buy individual health insurance, your employee can also provide you with workplace health insurance . The Insurance Regulatory and Development Authority of India (IRDAI) has made group insurance mandatory.

Typically, the coverage amount tends to be low for group life insurance . Thus, it might not provide sufficient cover in case you need it. Hence, it’s recommended to opt for an individual life insurance plan in order to get sufficient life cover.

Here are some differences between group and individual health insurance-

What It Means?

Group health insurance provides cover to a group of people. However, an individual health insurance plan covers one individual.

Who Purchases It?

Group health insurance is typically purchased by an employer. However, an individual health plan is purchased by the policyholder.

Add-Ons

Typically, there is no option to buy an add-on with a group health insurance plan. But with an individual health insurance plan , a policyholder can buy various add-ons.

Sum Insured

The sum insured provided by group insurance tends to be low compared to the sum insured of individual health plans.

Here are some factors to consider when purchasing group health insurance for your employees-

Flexibility
Group health insurance

plans should provide flexibility to employees. They should be allowed to make modifications to the plan, such as adding family members.

Easy Claim Settlement

It’s essential to opt for an insurer that offers a hassle-free claim settlement process .

Sum Insured

As the medical expenses can be high, it’s crucial to opt for group health insurance that provides a sufficient sum insured amount. However, group health insurance tends to offer a low sum insured amount. Thus, you must research to look for insurers that offer a high sum insured amount.

Waiting Period

Ensure there is no waiting period to avail the benefits of the policy.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.