How to Calculate Employee Health Insurance Premium?

Group health insurance premiums are among the key expenditures for employers in India. These premiums provide coverage for the medical needs of employees and their families. Therefore, it's crucial for employers to grasp the mechanics behind premium calculations. This article explores different methods employed to determine group health insurance premiums and any potential exemptions that may apply.

Read more
secure-icon We don't spam

Whom do you want to insure?

  • Employee, spouse & kids

  • Employee only

secure-icon We don't spam

Whom do you want to insure?

  • Employee, spouse & kids

  • Employee only

Wellness At Work

Benefits of group health insurance

Parameters to Consider in Premium Calculation of Group Health Insurance

When considering group health insurance as an entrepreneur, it provides a reliable means to cover medical expenses without having to bear them individually. Premiums for group health insurance are determined by factors such as the employee's age, gender, and occupation. Various group plans offer different rates, so selecting the appropriate one for your workforce is crucial prior to procurement.

It's important to thoroughly comprehend your policy before making a purchase, as group insurance policies can undergo frequent revisions. If you seek enhanced coverage, group health insurance serves as an effective means to manage medical treatment expenses.

Here are key parameters to evaluate in group health insurance premium calculations.

  1. Average Age of the Employees

    Age is a significant determinant in group health insurance premium calculations. Typically, employees in their twenties and thirties incur lower insurance costs compared to older individuals. This discrepancy can be attributed to the higher prevalence of health issues and accidents among older age groups.

    Gender also plays a role in premium calculation. In India, women generally receive lower health insurance premiums compared to men. Additionally, geographic location can impact policy costs, with certain areas experiencing higher premiums due to prevalent medical conditions like cancer among residents.

  2. Nature of Job

    The nature of the job plays a vital role in deciding the insurance premium. Some jobs have a huge risk associated, while some are risk-averse. Therefore, the higher the risk associated with the job, the higher the premium will be.

    For example- A group health insurance company will offer low premium rates to insure the employees of the digital marketing agency because it is a desk job. While the premium for the production company will be more as the nature of the job is a floor job and the risk associated is more.

  3. Type of Coverage

    The scope of coverage under a single plan will decide the premium rate. In a group health insurance policy, the policyholder can widen the coverage by adding their immediate family members to their plans. Generally, there are three types of group insurance plans offered by home insurance companies-

    1. E-plan- for employees only,
    2. ESC-plan- for employee + spouse + up to 4 dependent children, and
    3. ESCP-plan- for employee + spouse + up to 4 dependent children + 2 parents

    Hence, the premium for ESC coverage will be lower than the ESCP plan.

  4. Total Sum Insured

    Sum insured means the upper limit amount your group health insurance company can pay in case your employee is hospitalised. The higher the total sum insured, the higher the premium rate charged for it. For an employer, it is advised to choose the correct sum insured and check other related factors like scope of coverage, network hospital, and inclusions of a plan offered by the insurer.

    For example- if there are two plans offered - Plan A (a sum insured up to Rs .3 lakh) and Plan B (a sum insured up to Rs. 6 lakh). Here, the premium for Plan B will be higher than the premium for Plan A because the total sum insured amount is more. However, it is advised to the employers to not purchase an group health plan just because it is cost-effective but to purchase an insurance plan that actually serves value to the employee in case of a medical emergency.

    Let us also tell you the factors you should consider while choosing the right sum insured:

    • Check your coverage to know what's included in each category and decide which benefits matter most to you.
    • Keep your group size below a set limit to reduce premium costs.
    • Premiums for group health insurance are based on factors like age, gender, and health conditions. Riskier members might pay more.
    • Remember, higher premiums don't always mean riskier members are more of a threat to public safety or health goals.
  5. Add-on Covers

    A standard group insurance policy covers hospitalisation expenses and ICU charges. In case you want to enhance the coverage, you can buy add-on covers available with it by paying an additional premium amount. These add-on covers can be dental care, OPD consultations, or dietitian's consultation. Moreover, the premium for any add-on cover you choose varies.

    For example- If an employer increases the coverage by adding the OPD consultation cover and dental care in the basic plan, it will increase the premium rate.

  6. Raised Claim History

    When a company is offering a group health insurance policy for the first time, it will not be covered under this factor. But if it is not their first time, the insurer will consider the previously raised claim history by the insured. In case the number of raised claims is high, the premium amount will also be higher. On the contrary, the insurance provider might offer you a discount if the number of raised claims is low in the past.

    For example- Company X has raised fewer claims during the policy period compared to Company Y, whose claim history is not good. In this situation, the insurer might consider increasing the premium amount for Company Y based on its previous claim records.

  7. Number of Employer-Employees Covered under Group Health Insurance

    The number of employer-employees covered is a crucial aspect of group health insurance, contributing to workplace health and safety. This insurance extends medical coverage to employees, irrespective of their individual health status or existing personal health plans. To ascertain the appropriate level of coverage for your company's workforce, you must initially calculate premiums based on the number of individuals within each classification.

    This calculation aids in determining the coverage that aligns with both your workforce's needs and your budget constraints. Once you've identified the classes requiring coverage and computed premium rates accordingly, it's essential to enroll all affected individuals promptly.

    Group insurance policies can be procured through participating companies or agencies. It's imperative to meticulously compare quotes to secure the most advantageous deal for your business.

Conclusion

An ideal group insurance plan covers the employees and their immediate family members at an affordable premium rate. Moreover, as an employer, you must check the claim-settlement process and customer services of a group health insurance company before buying group insurance from them.

calcu-img

Group Health Insurance Premium Calculator

Who do you want to insure?

  • Employees
  • Employees & their family
icon

Minimum lives should be 7

  • 1 Lakh
  • 2 Lakh
  • 3 Lakh
  • 4 Lakh
  • 5 Lakh

Include maternity coverage

Premium starts from

(Excluding GST)

Let's find the right plan for you

Speak to our experts to get the right plan for your company's needs

icon Expert advice made easy icon
  • Date
  • Time

When do you want a call back?

  • Today
  • Tomorrow
  • 18 Jul
  • 19 Jul
  • 20 Jul
  • 21 Jul
  • 22 Jul

What will be the suitable time?

  • 11:00am - 12:00pm
  • 12:00pm - 01:00pm
  • 01:00pm - 02:00pm
  • 02:00pm - 03:00pm
  • 03:00pm - 04:00pm
  • 04:00pm - 05:00pm
  • 05:00pm - 06:00pm

Tell us the number you want us to call on

Your privacy matters. We won't spam you

Call scheduled successfully!

Our experts will reach out to you on 4th June between 2:00 PM - 3:00 PM

Wellness At Work

Benefits of group health insurance

Disclaimer: Above mentioned insurers are arranged in alphabetical order. Policybazaar.com does not endorse, rate, or recommend any particular insurer or insurance product offered by an insurer.
We don't spam
View Plans Instantly
By clicking on " " you agree to our Privacy Policy and Terms Of Use
Whom do you want to insure?
  • Employee, spouse & kids
  • Employee only
Continue
icon Expert advice made easy icon
  • Date
  • Time

When do you want a call back?

  • Today
  • Tomorrow
  • 18 Jul
  • 19 Jul
  • 20 Jul
  • 21 Jul
  • 22 Jul

What will be the suitable time?

  • 11:00am - 12:00pm
  • 12:00pm - 01:00pm
  • 01:00pm - 02:00pm
  • 02:00pm - 03:00pm
  • 03:00pm - 04:00pm
  • 04:00pm - 05:00pm
  • 05:00pm - 06:00pm

Call scheduled successfully!

Our experts will reach out to you on 4th June between 2:00 PM - 3:00 PM

Thank you
Our experts will provide you assistance with your
insurance coverage. Be assured, all your questions
will be answered

Customizable plans from top insurers

starting @ ₹110/employee*

View Quotes
Group Health Insurance Articles
GIPSA stands for General Insurance Public Sector Association. It is a group of four General insurance companies...Read more
28 Apr 2022 by Policybazaar 23630 Views
Under Section 37(1) of the Income Tax Act, 1961, an organization can apply for tax exemption on the premiums paid...Read more
29 Nov 2022 by Policybazaar 14499 Views
GPA (Group Personal Accident) and GMC (Group Medical Coverage) are two popular types of insurance policies often...Read more
01 Jun 2023 by Policybazaar 13847 Views
The employer-employee insurance scheme is a valuable benefit for businesses, providing financial support to...Read more
05 Oct 2020 by Policybazaar 27213 Views
A group medical insurance scheme offers many benefits in addition to providing financial support during medical...Read more
08 Feb 2023 by Policybazaar 13877 Views
Companies worldwide strive to attract top talent by offering competitive salaries and outstanding corporate...Read more
15 Sep 2023 by Policybazaar 6846 Views
One of the biggest benefits a salaried employee get is group health insurance coverage. This is provided by the...Read more
27 May 2016 by Policybazaar 23833 Views
The Hospital's Third-Party Administrator Desk, often referred to as the TPA desk, functions as a valuable support...Read more
03 Nov 2023 by Policybazaar 5718 Views
GIPSA stands for General Insurance Public Sector Association. True to its name, it is an association comprising...Read more
14 Nov 2023 by Policybazaar 4906 Views
Adequate health insurance forms an important component in a sound and practical personal financial plan. Its...Read more
21 Sep 2022 by Policybazaar 11766 Views
Extended work hours or working on holidays and weekends have become common in workplaces Compensatory leave for...Read more
18 Apr 2024 by Policybazaar 6603 Views
Group health insurance for employees is one of the most common and favored types of benefits offered by the...Read more
25 Aug 2022 by Policybazaar 10749 Views
Offering group health insurance to employees is a critical benefit that enhances their well-being. In India, 80%...Read more
05 Oct 2023 by Policybazaar 6907 Views
As the name implies, Corporate Group Health Insurance is wherein the employer provides healthcare coverage to the...Read more
24 Mar 2014 by Policybazaar 22687 Views
Group health insurance is a customized policy that is usually provided by the employer in order to cover the...Read more
13 Feb 2023 by Policybazaar 4889 Views
Warning Letter is a formal letter that an employer issues to an...Read more
15 Jul 2025 by Policybazaar 5 Views
A Relieving Letter is a formal, written statement given by an...Read more
15 Jul 2025 by Policybazaar 5 Views
Section 37 of the Income Tax Act 1961 is the supplementary...Read more
15 Jul 2025 by Policybazaar 4 Views
Boolean Search is a rule-based, structured approach commonly...Read more
15 Jul 2025 by Policybazaar 5 Views
Recruiting candidates at the right time is needed to ensure...Read more
14 Jul 2025 by Policybazaar 8 Views
Full and Final Settlement (FnF) is the complete procedure...Read more
11 Jul 2025 by Policybazaar 3 Views
Industrialisation has been a major contributor to economic...Read more
11 Jul 2025 by Policybazaar 34 Views
A job description is often the first impression you make on...Read more
08 Jul 2025 by Policybazaar 30 Views
Employee exit process is a formalised set of procedures that...Read more
08 Jul 2025 by Policybazaar 61 Views
Privilege Leave (PL), or earned leave, is paid time off for...Read more
30 Apr 2025 by Policybazaar 740 Views
Performance appraisal is the regular evaluation of an employee's...Read more
24 Apr 2025 by Policybazaar 462 Views
External sources of recruitment are processes used by...Read more
24 Apr 2025 by Policybazaar 468 Views
An appointment letter is a formal letter signed and written by...Read more
24 Apr 2025 by Policybazaar 553 Views
Human Resource Planning, or HRP, is the formal process by which...Read more
11 Apr 2025 by Policybazaar 557 Views
Employee feedback is essential for building a motivated and...Read more
07 Apr 2025 by Policybazaar 447 Views
Policybazaar for Business - Group Health Insurance - Customer Reviews
View all
4.4/5
Based on 189 reviews
4.4
out of 5
Based on 189 reviews
38 users
136 users
15 users
0 users
0 users
3.8 April 09, 2023
Mansi
Excellent Support
It was easy to buy insurance from PolicyBazaar website and customer support was also amazing to clear all the doubts.Thankyou. Highly worth it.
Dehradun
4.3 April 01, 2023
Mahesh
Necessary Investment
It is a good and necessary investment. Thanks PB.
Lucknow
4.3 March 24, 2023
Surya
Provides Satisfactory Results
I purchased Group health insurance at policybazaar recently and i am so much satisfied with the plan. The application process was smooth and efficient, making the typically tedious task of getting insurance surprisingly hassle-free.Thanks PB.
Bareilly
3.8 March 16, 2023
Naveen
Helpful In Making Decisions
When it came to selcting the right Group Health Insurance, Policybazaar offered an impressive range of options from reputable insurers. I appreciated the comprehensive details avalable for each policy which helped me to take the better decisions. Thankyou.
Delhi
4.3 March 15, 2023
Rajesh
Increases Clients Expectations
I recently had the pleasure of securing a Group Health Insurance policy throug PolicyBazaar and I must say the Entire process exceeded my expectations! From start to finish, their service werw great. Thankyou.
Delhi
3.8 March 02, 2023
Ravi
Great Experience
I got great deals on PolicyBazaar website. Highly recommend.
Pune
4.3 February 17, 2023
Diljeet
Excellent Purchase
It was a excellent purchase at PolicyBazaaar. Thankyou team.
Coimbatore
4.3 February 04, 2023
Satya
Prompt Services
Policybazaar's efficient claims process was impressive. In case of any medical emergencies, my employees were able to get their claims settled swiftly, allowing them to focus on their health and recovery without worrying about financial aspects.Thankyou
Chennai
4.3 January 22, 2023
Abhishek
Budget Friendly Purchase
Thankyou PolicyBazaar for providing such a great plan at affordable premium rates. It was a budget-freindly purchase.
Delhi
4.3 January 09, 2023
Abhash
Multiple Range Of Benefits
I purchased Group health Insurance which offered me plans with affordable rates Thankyou PB.
Pune