All you need to know about a Group Health Insurance Policy

A group health insurance policy offers coverage to a group of people. The coverage is provided to all the group members and other dependent family members such as dependent parents, spouses, and children.

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#Premium may vary on the basis of coverage type & add-ons
**All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

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*Premium starting from ₹110/Employee/Month for ₹1 Lac Sum Insured covering Health & Wellness Needs (excluding GST)
#Premium may vary on the basis of coverage type & add-ons
**All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

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Disclaimer: The above plans and premiums are for 1 Lakh sum per life per month covering Health and Wellness needs of 7 Employees, 5 Spouse & 2 Kids below 35 years of age. The premium is inclusive of GST and do not cover PEDs & Maternity. Standard T&C Apply PolicyBazaar does not rate, endorse or recommend any particular insurer or insurance product offered by the insurer.

Usually, group health insurance coverage is offered by organizations, banks, business groups, housing societies, and employers to their employees and the cost of the premium is borne by the organization itself.

It is beneficial for corporates as the premiums paid for an individual policy would be way more expensive as compared to a group health insurance policy.

But the coverage offered under a group health insurance policy may not suffice. And the coverage is provided as long as the employee is part of the organization. For this reason, a group health insurance policy is not a great alternative to an individual mediclaim policy, especially for those who keep switching between private jobs. But, there are various other benefits of a group health insurance policy. Let’s take a look at the features of a group health insurance policy in detail-

Group health insurance

Individual Health Plan vs. Group Health Insurance

An individual health insurance policy is purchased for self and other dependent family members. Whereas, in a group insurance policy a group of individuals is given insurance under a single master plan-

Individual Health Insurance

Group Health Insurance

The contract of insurance is with the  policyholder

The employer or the organization owns the contract and the certificates are issued to the employees

The insured has the power to cancel the health insurance policy

In a group health insurance policy, the insurance company has the power to cancel your policy

The employment tenure does not affect the insurance  term

Coverage is provided as long as the employee is part of the organization

It is based on the individual’s age and medical history. The health insurance company considers all the risk factors.

It is more dependent on the financial strength of the employer or the organization.

An individual health insurance policy gets costlier as you age

A group health insurance policy doesn’t get costlier with the age of the employee

How Beneficial is a Group Health Insurance Policy for the Employees?

Group insurance ensures increased employee satisfaction and better health benefits for its employees-

  • Default Health Insurance Cover: Since, the insurance cover is provided to all the group members. Therefore, it is beneficial for those people who want to buy a mediclaim policy but cannot afford to pay the cost of the premium. Usually, the premium is paid by the employer, as a welfare measure for its employees.
  • Low-Cost Affair: To avail the benefits of a group health insurance policy, one just has to be an employee of the organization. It means when an employee joins the company, he/she automatically gets covered in a group health insurance policy.
  • Pre-medical Screening is not required: A pre-medical screening is required to determine the pre-existing medical conditions before purchasing an Individual mediclaim policy. Whereas, in a group medical insurance policy no such medical check-up is required.
  • Easy Claim Process: The claim process of a group health insurance policy is quite simple. Considering the legacy of the employer, the claim is settled in a speedy and hassle-free manner. The employee only needs to accept the health insurance policy and show the health card to initiate the claim.
Employee health insurance

Benefits of a Group Health Insurance Policy for the Employers

With a group health insurance policy an employee can avail a myriad of benefits that cannot be availed in individual health insurance policy-

  • Lower cost on Premiums: One of the immediate benefits to the organization is that they have to pay a lesser premium amount in case of group health insurance.
  • Tax Benefits: Group health insurance policy offers tax deduction benefits under various sections of the Income Tax department of India.
  • Employee Retention and Loyalty: Employee retention is important for any organization. Thus, the corporates are becoming more and more employee centric. Group medical insurance policies are used as a tool to ensure employees’ loyalty towards the organization. It also helps in the retention of old employees which reflects positively on the company’s image.
  • Motivates Employees: It takes off the stress from the minds of the employees. Thus, motivating them to perform better.
  • Flexibility to Pay the Premium: The companies have a choice to either pay the premium monthly, quarterly or annually.

How does a Group Health Insurance Plan Work?

  • Usually, a group health insurance plan offers a fixed amount of sum assured that covers the cost of accidental hospitalization, medical treatment of specified diseases and the likewise
  • Family members can also be covered in the same plan, depending on the type of the policy and the employer
  • The sum assured is based on the salary package and it varies from one company to another. To increase the sum assured amount, an extra amount of premium needs to be paid.

In a Nutshell

If you compare a group and individual health cover, it’s advisable to claim it from your group insurance first. Group insurance claim is faster and less complicated. The best is you do not have to bear the waiting period. Moreover, it gives you a cover of pre-existing illnesses since starting.  And if you want to claim from two insurance policies, it is advisable to claim from the older policy first, this will allow you to claim your already existing illnesses on time. 

Written By: PolicyBazaar - Updated: 01 July 2022
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