Group Health Insurance
Group health insurance is also known as a corporate health insurance policy. It is a policy that provides health insurance coverage to a specific group of people. For example, it includes members of an organization or selected employees of a company. The company or the employer usually takes a group health plan to protect employees and their families from rising medical expenses. This policy includes accidental hospitalization, critical illness cover, added health coverage, maternity coverage, domiciliary treatments, and COVID insurance.
Features of Group Health Insurance
- Existing Groups: Groups that are already in existence for some purpose can take group health policies. Any group created just to avail of the benefits of this policy will not be insured under this group plan.
- Minimum Members Required: For a group to be eligible for availing group health insurance plan, the minimum number of members is required. The number of members required may vary across plans. Usually, 20 – 25 members are required.
- Policy Tenure: This policy is issued only for one year. If a group wants continued coverage, then they must renew it yearly.
- Limited Coverage: This insurance policy provides limited coverage because individual health risk is not considered.
- Premium: It depends on various factors like the size of the group, average age of the members, sum insured, etc. The insurance company collects a single premium from the company or the group as a whole. Therefore, the premiums are affordable for individuals.
- No Medical Check-ups Required: Members are not required to undergo medical check-ups compulsorily. Group health insurance covers all pre-existing diseases of the members from day one of the plan.
- Waiting Period: Waiting periods are usually for 30 days, one year, two years, and four years as per different ailments. If desired, then these periods can be waived off under group plans.
- Claims: The coverage of members is not affected by the claim of one member. Insured members can avail cashless claims if they avail medical treatment from the network hospitals.
Also Read: Health Insurance – A Complete Guide
- Low Premium: Group health plan spreads insured individuals’ risk across the group. It helps in keeping low premiums and better risk management. In this group, plan premiums are lower as compared to traditional health insurance plans.
- Tax Benefits: These health insurance plans are beneficial to both employer and employee. If an employer pays a full or partial premium on behalf of employees, they can claim this amount and avail the tax benefits. If employee bears full or partial premium amount, they get tax deductions under the Income Tax Act.
- Coverage of Pre- Existing Disease: Individual health plans refrain from covering pre-existing diseases, but group health insurance covers pre-existing diseases of the insured members from day 1.
- Larger Maternity Coverage: Group health policy offers maternity sum assured where amount differs for Caesarean section and normal delivery. The amount offered under the group plan is larger than the individual health insurance plan. In addition, under the group plan, employees can immediately avail themselves of maternity benefits without any waiting periods.
- Increased Productivity: Under group plans, employees feel a sense of belongingness towards the organization. It helps in employee retention and better productivity.
- Limited Sum Insured: The amount insured under a group health insurance plan is limited and may become insufficient for covering high medical expenses.
- Facility for Present Members Only: Coverage is offered only to the present members of the group. Once a member leaves the group, then they are not eligible for any sum assurance.
- No Lifelong Coverage: Group plans need to be renewed each year, and employers may not extend the insurance. Employees cannot rely entirely on employers for their lifelong medical coverage.