Pros and Cons of Group Health Insurance Policy

With worries about hospitalization and rising healthcare costs, more people are seeking health insurance for security. As a result, individuals are increasingly favouring employers who offer health coverage. In response to this trend, employers are providing accessible Group Health Insurance options to support their staff.

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Pros and Cons of Group Health Insurance

Be it from an employer perspective or an employee’s perspective, group health insurance comes with several pros and cons.

Let us discuss the pros and cons of group health insurance policies.

Pros of Group Health Plan

Free of Cost Coverage

Group health insurance is provided by the employer to the employees. Therefore, the companies or organisations are responsible to pay the premium amount on behalf of the employees. Thus, the group health insurance plan is available free of cost to the employees.

No Waiting Period

A policy consisting of a waiting period compels the policyholder to wait for a pre-defined period in order to claim for a pre-existing disease. However, group health insurance does not include any waiting period. The employees are covered from day one of the group insurance policy. Therefore, they are entitled to raise claims for the pre-existing disease.

Coverage for Family Members

The group health insurance provided by the employer to the employees allows the latter to add a family member to the same insurance plan. For example, an employee may add his spouse or parents, or other family members under the group health insurance plan.

Maternity & New Born Baby Coverage

The group health insurance plan covers the expenses pertaining to the maternity of women. This includes treatment related to the delivery of a child. In addition, it also covers a newborn baby for up to 90 days under the same insurance plan.

OPD Coverage

The OPD refers to Out-Patient Department. It is a treatment provided to an individual or patient who is not required to be hospitalized. The group health insurance plan covers the patient, who requires consultation, prescription drugs, etc. One does not require to be hospitalized to seek an insurance claim.

Cons of Group Health Plan

The listed below are some cons of a group health insurance plan.

Discontinuation of Plan

An employee may not be permanent in the company. He may be compelled to leave the company, or the employer may lay off the employee in case of no compatibility. Under such circumstances, the group health insurance shall not be in force for such an employee. The employee shall be deprived of the privilege provided by the group health insurance plan upon his disqualification from the company and his post.

Employer's Discretion

The employer provides group health insurance to the employees. Therefore, the employer owns the power to determine the insurance company and coverage to be offered to the employees. It is at the discretion of the employees to select the features and benefits of a group health insurance policy. Hence, there is little scope for an individual employee to obtain a specific need.

Lack of Control

Since the insurance policy and its coverage are comprehensively controlled by the employer, the employees do not hold any control over the plan. The employees may not customize the plan as per their requirements. For example, if an employee wishes to enhance the coverage, he is required to pay the extra premium from his own pocket.

Insufficient Coverage

Usually the group health insurance provided by the insurer come with a sum insured ranging from Rs. 2 Lakh to 5 Lakh. When the insured goes for a treatment in a tier 1 or tier 2 city hospitals, the sum insured is not sufficient due to the cost of hospitalisation is on the higher side as compared to other areas.

No Tax Benefits

Since, you're not directly paying the premium for the health policy, you're ineligible for tax benefits under section 80D of the Income Tax Act. Nonetheless, you can qualify for these benefits by increasing the coverage and covering the additional expenses.


The group mediclaim policy is also known as cashless policy as the employee is required to reach the hospital and show the insurance card provided by the insurance company or employer. However, it is important to understand the pros and cons of group health insurance plan.

Policybazaar for Business - Group Health Insurance - Customer Reviews
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4 January 31, 2022
Good Deals
We bought corona group health cover for our firm. It is still risky and to make sure the safety for everybody, we bought the cover. It was on a good deal on Policybazaar.
4 January 30, 2022
Quicker Than Expected
I bought group covid insurance for me and my team We are a small start-up and really needed this cover. I bought it from PolicyBazaar which was quicker than I expected.
4.3 January 30, 2022
Health Cover
As we have started travelling again, I had book group Covid-19 health plan for me and my employees. We are travelling frequently now and obviously needed this health cover.
4 January 30, 2022
Quick Claims
For myself and my staff, I purchased group covid insurance. This cover was critical for us as a modest start-up. I purchased it through PolicyBazaar, and it arrived much sooner than I anticipated.