Corporates Keep Pulling Hands from Insuring Employees Parents

As a thing of concern, corporates have started withdrawing insurance cover for parents of employees who have opted for group mediclaim policies. The seemingly bitter move is a cost-cutting measure. Earlier, companies used to provide a regular parental cover to their employees but from the past 2-3 years, companies are continually shying away from providing cover for dependant parents under employee group mediclaim. Segar Sampath kumar, general manager at New India Assurance, expressed his concern over the issue and suggested that the corporate  should switch to co-payment mode for  covering employees’ parents, rather than ceasing the cover altogether.

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    It is observed that most people with employee benefit group policy which cater parental cover are seen to claim for their parent’s treatment. Thus, companies have started ceasing this cover to save their premium bills. For a change, corporate asked employees to pay separately if they wanted to insure their parents but as a consequence, this move came up with adverse effect. Only employees whose parents were suffering from pre-existing ailment came forward and got themselves insured. The majority chose to discontinue the policy altogether.

    As per industry reports, young employees insured by their companies make claims that are mostly related to their parents.  Once the parent group policy became chargeable, rarely employees opted for it and hence this landed to the policy’s discontinuation.

    The industry experts have proposed that the insurers should opt for other cost cutting measures instead of withdrawing the group mediclaim cover for parents. One way they have suggested is getting more and more policyholders involved in wellness programs to even out the availing of insurance benefits.  

    Ideally, there should be a portability option for senior citizens wherein the person can continue the policy even if the child’s group mediclaim is discontinued, but unfortunately there is no such system.

    Written By: PolicyBazaar - Updated: 29 July 2021
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