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  • What is Group Health Insurance?

    As the term suggests, group health insurance is a protection plan that provides healthcare coverage to a specified group of individuals such as the employees of a company. Here insurance is offered for a group of individuals rather than to individuals. Under a group plan, certain health insurance benefits are offered to individual employees (in cases to their families as well) by a company or employer.

    This type of insurance is also sometimes referred to as employee health insurance.

    Group health insurance is offered as one of the perks of the job in the same way as other perks such as housing, a company car or other perquisites may be a part of the remuneration package. Group insurance packages are often purchased by companies as a device to attract and retain talent. Though used interchangeably with the term employee health insurance, group health insurance may also be offered in respect of other groups such as the members of an association or a social/ cultural group or holders of certain credit cards, types of bank accounts etc.

    Typical features of group health insurance
    • Group health insurance is a form of insurance purchased by companies, institutions, associations or employers. This type of insurance is not available for purchase by individuals; who have the option of buying other health insurance products. Not all employers offer health insurance and within an organization as well, the type and quantum of health insurance offered may differ as per the position of the employee. For instance, those in managerial positions may receive comprehensive coverage as against limited coverage for those in clerical positions. Health insurance coverage often improves as a person advances within a company.
    • Usually, group policies offers benefits of a general health insurance policy such as hospital expenses including room rent, surgery, consultation and specialist charges, anesthetist fees, diagnostic fees as well as pre and post hospitalization charges. Cashless facilities are usually offered so that the insured individual can start to receive treatment without having to make or arrange upfront payment at the time of hospital admission.
    • Group health insurance is a flexible type of insurance and can be customized as per requirements and to offer the sort of coverage required.

    Special features of group health insurance
    • The inclusions and exclusions of a given group plan may vary significantly from one to another company. Additional features can be added to the policy to cater to specific employee requirements.
    • Some policies (and employers) offer maternity benefits under a group policy and may also cover specified daycare procedures that do not require 24 hours hospitalization (such as minimally invasive treatment, minor or keyhole surgeries etc).
    • Group policies may offer coverage for preexisting diseases or domiciliary hospitalization costs as well; however this could mean higher premiums for the employer/ company.
    • Many group policies waive waiting periods for making claims. Typically, health checkups are not mandatory.
    • Group policies may cover not only the individual employee but also their spouse, dependent child / children and dependent parents. In some cases, such coverage for the employee's family may be optional. The employee may be offered such coverage for part payment of policy premium. (Some companies require employees to contribute to premium payment to avail this additional coverage).
    • Health insurance providers typically issued one master policy that covers every individual of the group. Under this single policy, a single premium is paid; there is no need for paying separate premiums for each covered person.
    • A group plan can be created specifically and customized for a given company and its employees keeping in mind the nature of work, work related risk, the number of people covered, their age, existing medical conditions and other factors.

    From the foregoing it becomes clear that group health insurance can be a mutually beneficial for companies and employers as well as their employees.

    Eligibility for Buying Group Health Insurance

    The terms ‘group health insurance’ and ‘employee health insurance’ are often used interchangeably, since group health insurance is usually brought by employers to secure the health of their employees. In fact group health insurance products are specifically designed for small or large companies wishing to offer their employees extra perks in the form of the security accorded by health insurance. We look at eligibility and ineligibility for buying health insurance.

    Individuals are not entitled to buy group health insurance
    Since group insurance is rather like buying in bulk, it becomes feasible for insurance companies to lower their premiums.

    Hence, since group insurance can be cheaper than buying individual health policies to cover each employee separately, individuals may wonder if it is possible for them to buy group health insurance for their family and so on. However, group health insurance is not meant for individuals. Individuals are free to opt for individual health plans, family floater plans and so on.

    Group insurance is a pre-planned or a customized health insurance policy that a business or other organization can buy from the insurance company. The insurance policy would offer protection to specified employees to the extent of the sum assured and for ailments /accidents as are set out in the policy document. Companies, cultural organizations, clubs, proprietorships, partnerships, corporate entities or anyone who employs a certain number of people can buy health insurance for their employees.

    Eligibility for buying group health insurance
    The eligibility factor can be variable. Group policies may be offered for any group of people as specified by the insurance company. For instance while many group plans require groups of 20 or more people, some companies such as Star Health offer policies for corporate bodies or institutions with as few as 8 or more employees.

    Fledgling or small organizations with limited resources and few employees may be unable to buy group health insurance or may not be able to afford it. Startups and similar small organizations with limited resources may want to consider whether they can afford group health insurance. For small organizations with the resources but without the number of employees needed for meeting the criteria for eligibility to buy health insurance, it may be advisable to buy a group policy where not merely the employees but also their immediate family members are covered by the group policy.

    While for employers it may be desirable to retain talent within an organization by offering employee health insurance, it is also important to examine one’s resources, and then decide about buying group health insurance.

    Documents Required For Group Health Insurance

    One of the principal reasons for companies and employers to invest in group or employee health insurance is to offer an additional perk and a sense of security to valuable employees. This is seen to be a prudent investment aimed at improving employee morale and hence productivity. It is a very effective way in which to retain valuable talent within the organization and to attract new talent to the organization. Buying group health insurance is largely a simple, online process and is so by companies looking to make it easier for more people to buy group insurance. Here is what you need to get you started:

    Find out more group health insurance and choose wisely
    It is possible to buy the amount and the type of group health insurance that your organization requires in terms of features, coverage and premium payable. Employers can also decide whether they want to offer insurance, only for the individual employee or for their family; in the latter case, employees can be asked to contribute a portion of the premium amount in order to secure the health of their families. The documents required may vary accordingly from plan to plan.

    Choose the right health insurance provider to buy group plans: look for a company with a good record and customer service, an insurance provider who is willing and able to tailor a plan to your requirements. It is also important to look for features such as graded cover (to cover different grades of employees) and functionality to easily add and delete employee records on the policy books in an efficient and streamlined fashion.

    A well thought out employee insurance plan can help employers save money, increase productivity and lose less money by way of sick leave and workers’ compensation. Add riders or additional coverage features depending upon the nature of work employees engage in, their average age (which helps decide whether critical cover is necessary), gender ratio (to decide whether or not maternity benefit is a key inclusion), income, standard of living etc.

    Documents required for buying group health insurance
    Health insurance providers offer the option of standard group health insurance or the option of creating a plan tailored to your requirements. The required documents could vary based on the insurance service provider’s rules and regulations, the number of people covered by the policy, the size of the organization and the nature of work (whether hazardous processes or substances are involved), whether accidental death cover is opted for and based on the age range of employees.

    Most insurance providers do not require much in the way of documentation to issue a group health policy. Once a plan is chosen and customized as per requirements, the policy buyer should thoroughly read and check the terms and conditions of the policy document and then fill out the application form with all required details accurately and precisely filled in.

    In most cases, when the insured individuals are below the age of 50, medical checkups are not required. Details about the covered individuals, their age and ID proof, details about their employment may need to be submitted along with the form. However, this also may vary from plan to plan and from one to another insurance provider and another.

    In any event, the insurance company will typically require the policyholder to make certain declarations about the health and wellbeing of the covered individuals and to declare any material details about their health such as relevant medical history, preexisting diseases if any. The failure to make full disclosure of all pertinent could mean problems with the claims process.

    Documents required for making group health insurance claims
    While insurance companies require few documents at the time of creating and selling a group health insurance policy, set procedures have to be followed and requisite documents must be submitted at the time of making claims:

    • A preauthorization form, duly completed, would be required at the time of being admitted to a hospital for a cashless claim. The claim acknowledgement number and the claim form with important details such as the employee code would have to be submitted.
    • If an employee health insurance card is issued by the insurance provider, the same would have to be presented at the time of seeking hospital admission
    • Intimation of such admission is required to be given to the health insurance company or to the TPA (Third Party Administrator) in the manner and within the specified time as required by the terms of the insurance policy. For planned hospitalization, advance notice is usually required; for emergency admissions, notice has to be given within a specified timeframe (usually within 24 hours).
    • ID proof and possibly proof of employment would be other required documents for group health insurance claims.
    • While for cashless claims the hospital would directly send documents to the TPA or insurance company, in the event of receiving treatment at non-network hospitals, the employee would need to keep track of and submit all original documents. These would be: duly completed claim form, doctor's report, medical bills, investigation reports like lab tests, X-rays and reports for establishing existence of the injury. Discharge summary with the final bill and detailed breakup would also be required.
    • For accidental death claims, documents such as the police report, death certificate, postmortem report and other relevant documents would have to be submitted where necessary and applicable.

    The policyholder company /employees can ensure a smooth purchase and claims procedure by ensuring that all required documents are accurate and complete in all respects and that they are submitted as and when required.

    Advantages of Employee Group Health Insurance

    Group health insurance is a health insurance product that companies and employers typically purchase for protecting employees of their organization. Group health insurance is a convenient and mutually advantageous product that benefits employers as well as employees. Here are some advantages of group health insurance and a look at some of its limitations.

    General advantages of group health insurance
    • Usually there is no requirement for medical checkups prior to issuance of the policy. This streamlines processes and saves time; being beneficial for the employer as well as the employees.
    • Depending upon who pays the premiums – in some cases employees may be required to contribute to premium payments – certain tax benefits are available to the employer as well as the employee.
    • For employers as well as employees there is an obvious advantage of good overall health and boosting employee morale. Health insurance benefits translate to a healthier workforce. When the health care needs of employees are taken care of, they suffer less stress, resulting in improved productivity; even fewer workdays lost, which is mutually beneficial.

    Advantages for companies and employers
    • One of the main benefits of offering health insurance to employees is that this acts as an attractive perquisite for current as well as potential employees. Employers can attract talented individuals to their company by offering health coverage. A good health plan along with the salary also helps to retain the company’s existing talent pool and helps in motivation. When an employee is secure in the knowledge that their employer would manage health expenses if any, they are more willing to take up a job and to stay with the company for longer.
    • Group policies can be very cost effective vis-à-vis individual policies. Rather than buying individual policies for employees, it is undoubtedly more cost effective for employers to buy group policies. Premiums are lower – up to 30% lower than individual policies according to one study – and hence can be very economical. Policies can therefore, be tailored to the budget of the company.
    • For group policies, there is one master policy issued for covering multiple individuals. One composite amount is to be paid in this respect. The policy is easier to manage because there is only one single insurance premium payment to keep track of. Employers may also be able to avail no-claims bonus and assured renewal benefits.
    • Group policies are flexible and customizable. The employer or company can choose the type or coverage, the number of individuals to be covered as well as the features of a policy as per their requirements. The features, inclusions and exclusions can be altered keeping in mind the size of the organization, the number of employees there are, their classification, age, gender as well as the nature of work they engage in.

    Advantages of group health insurance for employees
    • For individuals who do not have health insurance, a company who offers health insurance is some obvious benefits. Even for those who already have health insurance, additional insurance offered by the company can be welcome. Group health insurance coverage from the company helps to add an extra layer of protection to existing individual insurance policies.
    • Group health insurance policies could be customized to also include the family members of employees. In some cases, companies permit their employees to opt for coverage of dependent family members by contributing in part to premium payments. In some cases, the company may undertake the extra premium payments and in other cases, the employee may be required to make part payment of the premium.
    • Since it is possible to customize group policies to cover maternity benefits, daycare procedures, ambulance services and so on, employees benefit from such comprehensive coverage. Specific coverage /protection may be offered for the sort of work and the nature of risk that the employee undertakes.

    Limitations of group health insurance
    Group health insurance is company or employer specific and not employee specific. Hence its benefits cease when a person leaves their job. The health insurance coverage under a group policy will not carry over to the new place of employment unless the new employer also offers health insurance. The employee may have to buy his or her own health insurance if the new employer does not offer it.

    In spite of the few limitations however, group insurance remains an attractive and mutually beneficial option for organizations and their employees.

    Who should buy group health Insurance

    Group health insurance is term frequently used to denote employee insurance. However, the scope of group health insurance goes beyond merely the health insurance that is provided to employees by their employer or company. We look at who needs group health insurance and who can buy it for whom.

    Who needs group health insurance?
    An entity or a corporation that employs people would typically need to buy health insurance for the following reasons:

    • To protect and secure the health if their employees in order to maintain a healthy workplace environment.
    • Companies that offer health insurance to employees can ensure that employees pay proper attention to their personal health resulting in higher productivity and lower incidence of lost workdays because of poor health.
    • Companies that invest in group health insurance for their employees are able to attract talented individuals to take up employment, since health insurance is an attractive perk that enhances the offered remuneration package.
    • Group health insurance facilities also send out the message that the employer or company cares about their employees. This enhances the company image and also increases workplace motivation. It can encourage valuable talent to stay within the company; thereby reducing attrition rates.
    • Employees who do not own individual health insurance policies would be looking for job opportunities that offer health insurance as one of the perks of employment. Such individuals would be better off seeking employment where health insurance is offered.
    • Any company that wants to be able to offer their employees coverage for a wide range of illnesses and accidents, hospitalizations, surgical costs, ICU facilities, prosthetic or other post illness aids needs group health insurance. Companies can also opt for optional add-ons such as critical illness cover and customize the group policy with various other riders.
    • Group health insurance is a must for companies that engage in certain hazardous processes or whose employees are required to undertake a certain amount of risk in the course of their work.

    Who can buy group health insurance?
    Since group insurance has specific benefits such as rates that are more competitive than other forms of insurance, the IRDA has made it clear that group insurance can only be sold to groups.

    The IRDA has issued Group Insurance Guidelines to clarify who may and may not avail of group insurance policies.

    Specifically, individuals who have a certain number of employees on their payroll would buy health insurance. Incorporated companies, proprietorships as well as partnership firms can also buy group health insurance to protect the health of their employees.

    Group health insurance can be purchased by / for a group of employees or by a corporate entity. Nonprofit organizations, institutions, associations or clubs can also purchase it for their employees or members. Sometimes banks and financial institutions offer insurance to all those who open a certain type of account with them or buy a certain grade of credit card from them. Here as well, the bank or institution as an added incentive to encourage people to buy their financial products or use their services would purchase a group policy.

    It is not open to individuals to buy group health insurance; however, individuals can always seek the benefits of group health insurance in other ways!

    What are the Top group health Insurance Plans available in the market

    Group health insurance plans help secure the health of employees of a particular organization as well as the families of those employees in some cases. Group health insurance plans can vary very significantly in terms of the total cover offered, the number and age of individual covered, the nature of work they engage in as well as the features /inclusions of the plan. We look at some of the top group health insurance plans available in the market as well as how to choose the best group medical plan.

    How to choose the best group plan
    • Ideally, a plan should cater to the size, structure and type of organization.
    • If the organization in engaged in hazardous processes or there is the likelihood of exposure to pollution or toxic chemicals, the plan should offer specific protection for the sort of risk that the employees face in the course of performing their work related duties.
    • The plan should come into force from the day of policy issuance.
    • A group plan that covers X number of individuals is typically much more economical than the same number of individuals plans. Hence a group plan should be a cost effective solution for the employer company; one that dovetails with the organization’s insurance budget allocation.
    • Company personnel or individual employers would do well to choose a top rated group insurance plan that is highly customizable as well; a plan where the inclusions, features and riders can be chosen in accordance with specific requirements and budget. The plan should be able to offer grade-wise benefits, include daycare procedures and so on.
    • Ideally a group health insurance policy should be of the sort that attracts top talent to an organization and helps retain talent with the organization by reducing the rate of employee attrition.
    • The plan should also have the option of a contributory (a plan where the employee pays a portion of the premium along with the employee) or noncontributory plans
    • A simplified claim structure, the availability of a large network or hospitals and diagnostic centers where employees can receive cashless treatment are other features to look for.

    Best group health insurance plans available in the market

    Star Health Group Policy – This policy is designed to help organizations run smoothly by taking care of employee health and also offers tax benefits. Any organization or institution comprising of more than 7 persons can opt for this policy. Standard features include over one hundred day care procedures as well as non-allopathic treatments. It is possible to get a quote by filling in a simple form with contact details as well as a few others such as the company name and industry as well as the number of employees – 7 to 100, 101 to 500 or 501+.

    Apollo Munich Group Health Insurance Plans – Group plans for Apollo Munich provide cover for a wide range of accidents and illnesses that require hospital stays as well as diagnostic procedures, room rent and boarding, ICU charges, prosthetic and surgical costs. Critical illness cover is an optional feature that the policyholder can opt for as well. To get started, one can request a call-back from the insurance service provider simply by entering one's phone number and email address.

    HDFC Ergo Group Health Insurance – Also considered to be among the top group health insurance plans available in the market, HFDC Ergo offers plans that offer tailor made insurance solutions to the policy buyer. The company offers comprehensive coverage for a wide variety of industries and assured service to help companies take care of their biggest assets; employees!

    The plans offered cover not only employees but also their respective families, personal accidents, travel insurance for organizations that need to engage in a lot of corporate travel and more. Plans offered also include casualty insurance, group personal accident insurance, marine insurance, trade credit insurance and more. You can ask for a call-back or request a company representative to come and visit. Simply select your location, the product required, name and contact number to get started.

    ICICI Lombard Group Cover – The standard features of this policy include cashless claims, pre and post hospitalization charges and tax benefits for the policyholder. Covered individuals under the age of 50 do not have to undergo medical tests. The policy can be purchased and extended online; the sum assured as well as the number of people covered can be increased or decreased.

    The policy can be customized as per the size of the organization, the lifestyle and financial status of the covered individuals, preexisting illness and the types of emergencies that the policyholder envisages could be likely to occur. You can download the ICICI Lombard health insurance mobile app, live chat with a representative of the service provider or request a call back.

    Future Generali Group Health – Another one of the top rated group health insurance plans currently available on the market is offered by Future Generali. The plans offered follow IRDA guidelines and offer cashless facilities for all expenses incurred for treatment from the time that employees step into a hospital until the time they are discharged. Covered procedures include diagnostic procedures, dialysis, chemotherapy, prescription medications and so on. The company offers a range of employee benefit insurance plans including group health plans and group personal accident plans. You can read the policy wordings, get more information from the company toll free number or by using the Live Chat option.

    Go ahead and secure the health of your employees, boost motivation and productivity by the simple expedient of choosing the best group health insurance plan for your organization!
    Are there any riders/add on in group health Insurance
    Group Health Insurance is usually a highly customizable insurance product. Since single employers with a small business and few employees will have very different employee health insurance needs from a large corporation, insurance companies make it possible to opt for riders/add-on options in group health insurance policies to suit diverse requirements. Standard group health insurance policies usually have certain built in coverage/features. In addition, employers can choose riders to suit the number and age of their employees, the nature of work and level of risk faced in the workplace.

    Standard inclusions of a group policy
    • Hospitalization expenses including room rent, specialist consultations, nursing, surgery and anesthetist charges, prescription medications as well as ICU charges
    • Pre and post hospitalization expenses (30 days prior to admission and 60 days post discharge).
    • Specified daycare procedures that do not require 24+ hours hospital stays
    • Diagnostic procedures, prosthetics, radiotherapy, chemotherapy, dialysis, X-ray, implant etc and similar expenses connected to the hospitalization
    • Domiciliary treatments subject to a maximum amount that may not exceed a certain percentage of the total sum assured.
    • Pre-existing diseases may be covered or may be available as riders/add-on options in group health insurance. In some cases there could be a waiting period; in other cases the waiting period could be waived and coverage offered from Day One of the policy.
    • Any other specific inclusions as specified by the service provider’s policy document or by mutual agreement between parties.

    Optional riders /add-ons for group policies
    It has to be kept in mind that group policies vary significantly from one to another service provider and products are very diverse keeping in mind the diverse requirements of policy buyers. Hence, some insurance companies offer certain features as part of the policy whereas others offer those features as optional riders.

    • Maternity cover – hospital and other expenses related to pregnancy and childbirth may be standard inclusions or may be available via optional riders. These may or may not be subject to a 9-months waiting period. Similarly, neonatal or child cover may also be offered under group health insurance or may be available as a rider. The coverage may start from date of birth, three months after birth or after any other specified length of time.
    • Critical illness cover – Critical illnesses such as heart disease, stroke, cancers and so on are usually not a part of standard health insurance plans; but companies or employers buying group health insurance can opt for critical illness cover if required.
    • Waiver option – Some policies may waive the waiting period of 30 days for making a claim for specific diseases and may also waive the waiting period for preexisting diseases from the beginning of the policy. In some cases such waivers may be available as and by way of a rider.
    • AYUSH or complementary medicine coverage – Usually health policies cover only allopathic treatments offered by registered and certified medical doctors (MBBS). Policyholders would usually have to opt for coverage for AYUSH (ayurvedic, yoga, unani, siddha and homeopathy) treatments, naturopathy and other alternative medicine or complementary treatments as an optional add-on to the policy.
    • Health cover for employee’s family – While many companies offer health coverage only for the individual employee, some companies offer health insurance protection for the family of the employee as well: spouse, dependent parents and children of the employee. In the event of the group policy offering coverage for the employees’ family, the employee may be required to contribute a part of the premium amount.
    • Grade-wise benefits – A group policy could be so designed as to offer different levels of protection to different employees by grade. For instance senior executives could enjoy enhanced coverage with more inclusions whereas junior employees would be offered basic coverage.
    • Personal accident / death benefit – A group insurance policy can also be designed to include such additional features; particularly if the industry or the nature of work carries a certain amount of risk, requires involvement with hazardous processes or toxic substances.
    • Overseas health insurance – Again, this would depend upon the nature of the job and upon the spread of business operations of the business. The frequency of travel required by employees is a pertinent factor as well. Here the group health insurance rider can specify which overseas locations are included in the policy.

    Customize your group health insurance policy with riders and optional ad-ons
    The most unique feature of group health insurance is the ability to create unique policies to suit the nature and specific needs of corporate /business entities. Rather than specific riders, companies or individual employers can work with insurance service providers to create unique group or employee health insurance policies to suit their unique requirements.

    Policies can be created to cater to small organizations with just a few employees (fewer than ten individuals) or to cater to hundreds of employees with different job descriptions and pay grades. As a company or business owner, you can pick and choose the sort of coverage that makes the most sense for your business while offering your employees optimal health coverage.
    Difference between Individual health plan & group health Insurance
    Health insurance is something that no one can afford to be without. Not only do illnesses, diseases or accidents strike at any time without warning, medical expenses can be a huge drain on individual and family resources. Add to this the fact that medical treatments are constantly becoming more and more expensive; the necessity of medical insurance becomes clear. Companies offer a range of health insurance products such as individual health plans, group health insurance and more.

    Group plans and individual health policies are similar in some ways
    Both group and individual plans cover hospital expenses, pre and post hospitalization expenses. Both types of health insurance can be customized to some extent. Policy buyers can pick and choose the riders or add-on features that suit their needs.

    It is possible for individuals to be covered by a group plan offered by their employer and also purchase individual plans for themselves and their families as an extra layer of protection. In other words, group and individual plans can run concurrently for a single person offering more comprehensive coverage.

    Principal differences between individual health plans and group health insurance
    • Group health insurance is meant for employers whereas individual plans are for self/ family coverage – Also called employee health insurance, group health insurance is usually bought for employees by corporate entities, proprietorship or partnership firms or any other type of employer. Group plans can also be bought by associations, clubs or social groups or may be offered to those who hold certain types of bank accounts or credit cards. This type of health insurance is not meant for individuals who want to buy health insurance for themselves; but is purchased by the employer for their employees.
    • The premiums are significantly lower for group health insurance – Since the risk is spread out over a larger group of people, it is perceived to be lower. Since group health insurance is one consolidated policy for many individuals, it is possible for insurance companies to offer a bulk discount benefit to policyholders. Hence the premiums payable for several people under a group policy are typically much lower than the total premium that would be payable for individual policies for the same number of people.
    • Individuals cannot buy group health insurance – Though the lower premiums may appear attractive, individuals cannot buy group health insurance. Group insurance is meant for purchase by companies, institutions and so on. Individuals are free to choose from a variety of health plans such as family floater plans, comprehensive health coverage plans, Mediclaim policies and so on.
    • The individual does not get tax benefit / no-claims bonus under a group plan – If you are an employee whose employer offers health insurance cover, you will not be able get tax benefit for that coverage. The tax benefit accrues to the employer or policyholder who pays the premium. However, in some cases, there may be a co-pay feature in the group policy where the employee pays part of the premium (as in cases where the policy covers not only the employee but also their family). In such cases, the covered employee may be able to derive a certain amount of tax benefit. Similarly, since it is the employer who pays the insurance premium, benefit of any to-claim bonus offered by the insurance company also goes to them and not the employee.
    • Group plans are an employee incentive while individual plans are for self protection – Large corporations as well as smaller businesses offer health coverage as a perquisite in addition to the salary paid to employees. This is meant to attract capable and talented people to join the organization as well as to incentivize their staying with the organization for longer durations and lower rates of attrition. Hence individual plans are bought by individuals for the protection of their own health, whereas group plans are offered as an employee incentive.
    • Group plans can be customized by employees – While insurance companies would customize group policies to offer features and graded coverage as required, the employee cannot choose and alter policy terms of a group policy. However, an individual can customize their own individual health plan to include features and riders they or their family require.
    • Individuals may be denied health coverage under individual plans but not group plans – Depending upon the age and medical history of a person, if the insurance company perceives the individual to be a very high risk individual, they may refuse the issue a health insurance policy to them. In some cases, the policy may be issued, but the coverage may be limited and premiums may be very high. However under a group policy, coverage of such a person cannot be denied. Hence certain individuals may find it easier to get health insurance via group policies.

    The differences between individual health plans and group insurance are many; however an individual can derive benefit from both simultaneously. In fact it is recommended that individuals should purchase personal health insurance or family floater plans even if their place of work offers health cover to enjoy the best, most comprehensive health coverage.
    Is Group Health Insurance sufficient for any individual?
    Most people know that health insurance is a prudent investment that helps protect against the financial burden of paying for medical expenses arising out of illness, disease or accidents. While an individual can buy personal health insurance to protect themselves and their family, employers, to cover health related expenses of their employees, provide group or employee health insurance. Many people assume that if their employer provides health insurance, there is no need to buy a personal health insurance. Is it correct to assume that group health insurance is enough for an individual?

    The possible limitations of group health insurance
    When a person receives health insurance cover as a perk of their job, they typically do not examine the nature, features and inclusions of the insurance policy closely. The health policy may not be very apposite to their particular requirements of medical history. The scope of the policy may be limited and the coverage generic rather than specific. There may also be certain loopholes in a group policy that may render it inadequate in some cases.

    Why buying individual health insurance policies may be prudent
    Experts usually advise that one should invest in an individual policy even if their workplace offers health insurance; for the following reasons:

    • An individual ought to have a health insurance policy that covers not only their own health but also the health of aged parents, dependent children and spouse. Many employee health insurance policies may not extend coverage to the family of the employee; hence a family floater plan in addition to group insurance may be indicated.
    • The benefits and coverage under a group policy is pre decided and these cannot be altered and varied upon the say so of different employees. Hence if an employee wants specific coverage for critical illnesses, certain preexisting conditions or certain procedures that may not be covered under a general policy but to which they may have a genetic predisposition to, buying individual health insurance is indicated.
    • A group policy is less flexible than an individual plan. It is possible to customize an individual policy according to one's age, medical history, lifestyle and budget; so that riders can be added and the overall policy limit can be enhanced as required; whereas the same is not possible with employee health insurance. For individuals who would like to opt for add-on coverage such as daily hospital cash, a better class of private rooms in the hospital and coverage for critical illness, it is advisable to opt for individual health cover.
    • Another reason to buy a separate individual health insurance policy is that employee health insurance ceases along with the employment. If a person leaves the company’s employment or is dismissed, they may have no health insurance cover until they get another job. There is no guarantee that the next employer will also offer health insurance or if the coverage offered by the new employer would be adequate.
    • Health insurance premiums increase with age. Hence, if a person waits until retirement to buy health insurance, the policy could turn out to be very expensive at that later stage in life. The health insurance company could refuse to issue a policy for persons of advanced years or to someone in poor health who is perceived as posing a high risk to the insurance company. To avoid paying exorbitant premiums it is prudent to buy health insurance early in life.
    • As medical costs continue to rise over time, group plans may be insufficient to pay for treatments; particularly newer, cutting edge treatments. As such, a group plan may have to be supplemented by an individual plan.
    • A survey revealed that group health insurance typically falls short on certain parameters such as coverage for general consultations, diagnostic services, and maternity education and so on. While many employees would like to have coverage of these under their employee plan, in reality the plan may not offer the features they actually require.
    • It is seen that making a claim under group health insurance may result in high out of pocket expenses, which the covered individual would have to defray out of their own pocket. An individual policy would help take care of these expenses.
    • Personal plans also offer tax benefits and no-claims bonuses to the individual whereas in a group plan, these benefits would go to the policyholder (employer or company).

    It is important to check the features of one’s group policy and to supplement it with an individual policy if there appears to be any shortfall or deficiency in the group plan. Even if the group plan is a good one and comprehensive in terms of its features and coverage, it may still be advisable to buy individual health insurance for better, well-rounded health protection for the entire family.

    In addition, in an unpredictable market scenario, one can never be certain about layoffs. If one finds oneself without a job at some point - at least they would have a health insurance cover!
    What happens to Group Health Insurance when an employee leaves the company
    Group health insurance is an insurance product that employees typically buy as an added incentive for their employees. Since this type of insurance is designed to safeguard the health of employees, it is also called employee health insurance. We look at who can avail this type of health insurance and at what happens when an employee leaves their place of employment.

    How group insurance works
    Group insurance is bought by an individual or corporate entity for their employees. It could be a large company or a small proprietary firm buying a group policy to secure the health of employees. A cultural association could also buy a group policy for members or employees, or a bank could buy a group policy to offer health cover as an added benefit to certain account holders, credit card holders and so on.

    Some types of group insurance are purchased by a group of employees themselves. Buying group insurance can be a lot cheaper than buying several individual policies. Hence in some cases, employees may get together and pool their resources to pay the premiums for a group health policy.

    There is yet another form of group health insurance. Here the health insurance cover is provided by the employer or the company by creating a self insurance pool for the benefit of employees. There is no involvement of a third party such as an insurance provider company here. Certain large corporations have stopped buying policies and create such self insurance pools under which their employees are provided health insurance protection.

    What happens when an employee leaves employment?
    Group health insurance or employee health insurance is coverage for the person in their capacity as an employee, member or as the user of a particular service. The health insurance policy will continue to cover the individual (and in cases their family) only so long as they continue to be in the employment of the company or remain members or users or the particular service or product; after which it ceases.

    It is also not possible for an individual to purchase a group plan for themselves. Group health protection is only available to members of certain groups; whether they are employees or members or users of certain services.

    Hence as soon as a person leaves the employment of the company or the individual employer, the benefit of group health cover ceases. The health cover will also cease if a person’s service are terminated by the employer. If a person is no longer part of the club or association or no long holds the bank account or credit card also, the health cover could cease. This is because the person is no longer part of the group for which the insurance policy was purchased and hence they cannot take advantage of the same.

    In fact this is one of the chief perceived drawbacks of group health plans; the fact that it is linked to person’s place of employment. To ensure that a person is not left without health insurance in the event of termination of service, it is advisable to buy an individual health policy as well. Not only is this a fallback position, it also provides extra coverage while making a claim.
    Who all are covered under group health Insurance benefit
    Group health insurance is one type of health insurance – an insurance product under which the health of groups rather than individuals is insured. We look at who all are covered under group health insurance, who can benefit from its protection and who cannot

    Group health insurance covers:

    The employees of any corporate entity, partnership or proprietary concern that buys a group policy will be covered by it.

    All or some employees of the organization as may be specified are covered under a group policy and continue to be covered so long as they remain in employment and as long as the policy is renewed.

    Within an organization, some employees may receive coverage (such as senior or permanent employees) while some grades of employees may not.

    The family of the employee, such as the spouse, dependent children and/or parents of the employee may also be covered under the policy if such provisions are made under the policy. It is up to the employer to decide what sort of cover to offer employees and what sort of policy to buy. In some cases, health insurance cover may be issued on a co-pay basis; where the employee pays a part of the premium to derive benefit of coverage for their family as well.

    The members or employees of certain cultural organizations or clubs can be considered as groups for the purposes or buying group health insurance.

    In some cases, a group of people who have the same bank account or credit card can also be considered as a group and a health policy may be issued for such a group.

    Employees may also come together to form a group in order to buy a health policy to derive benefit of reduced premiums and other attractive features of a group health plan.

    People with preexisting conditions may also be insured under a group health policy.

    Those covered under a group plan may be able to avail protection from the date of policy issue – there may be no required waiting period to make a claim before coverage starts.

    Group health insurance benefit does not cover these employees or individuals

    Individuals who leave employment or are dismissed from employment will cease to be covered by the group plan and cannot make claims under the policy any longer.

    Retired employees will also not receive coverage under the group plan, unless their retirement or pension package expressly provides some form of medical coverage for them and /or their family.

    Those who stop being a member of an organization or stop using a product or service will also stop receiving the benefit of the group plan linked to that organization or service.

    If an employer company fails to pay premium for a group policy or does not renew a group plan, the people insured under the policy will stop receiving coverage.

    Any employee could cease to be protected under the provisions of a group plan at any time if the employer chooses to discontinue the policy or to withdraw the health care perk. The health plan can also be amended to cease offering coverage to the family members of the employee if the employer so wishes.

    A change in the terms and conditions or the coverage features of a plan could mean that fewer employees are covered under a group plan or that the (previously covered) family members of an employee are no longer covered under a plan.

    Since protection under a group health plan ceases along with employment, experts always recommend that even those who have the benefit of group health insurance at their place of work should purchase individual group insurance policies.
    What are the exclusions of group health Insurance
    As a rule, group health insurance policies vary greatly in terms of their scope and their features. Since this type of health insurance caters to companies, individual employers and to institutions of different sizes and types, they are typically customizable and can be altered to suit requirements. Hence the cost, inclusions and exclusions of group health insurance policies may vary significantly. That said we look at what such policies generally offer and what they typically do not offer.

    Group health insurance generally covers the following:
    • Features of a typical general health insurance policy; i.e. hospital expenses including room rent, OT charges, surgeon/ specialist consultation, medications are covered. Pre and post hospitalization expenses are also covered by group insurance.
    • Coverage offered is for the maximum sum assured. Multiple claims can be made under the policy by any of the persons covered; which may be specified employees (and their specified family members if applicable). However aggregate claim amounts are subject to that maximum sum assured.
    • Usually the waiting period is waived under group health insurance so that employees can make claims at any time while the policy is in force. Group health insurance policies also cover those daycare procedures as may be listed in the policy document.
    • A group health insurance policy could also offer cover for maternity benefits, critical illness cover and may have any other specific, optional inclusions that the policyholder has opted for.
    • As is the case with all health insurance policies, the policyholder is free to port their policy to another service provider.
    • Depending upon the nature or the business and the amount of health risk or accident risk that employees would typically have to undertake, some policies may offer special accident cover, disability compensation and critical illness cover.

    General exclusions of group health insurance
    • Usually a group policy would exclude preexisting conditions and claims may be entertained only after a specified period (12, 24, 48 months etc) of the policy being in force.
    • Some policies may also have a waiting period of 30 days from the initiation of the policy before claims for certain illnesses can be made. There may be a waiting period of a year for certain other illness or day care procedures such as cataract and so on.
    • Group health insurance covers allopathic treatment and pays for consultations with registered, licensed medical practitioners only. AYUSH or alternative /complementary treatments such as naturopathy are not covered. In fact any treatments offered by non-MBBS practitioners are generally not covered by group health insurance unless expressly stated.
    • Expenses towards dental treatments, hearing aids or optical aids such as spectacles will not be paid for by group health insurance. (However if such treatment becomes necessary because of illness or accident, the insurance company may pay for it).
    • Expenditure arising out of addiction, substance abuse or treatment arising from such conditions is also one of the exclusions of group health insurance.
    • Assisted childbirth procedures such as in-vitro fertilization, surrogacy, artificial insemination etc will not be covered by group health insurance.
    • Congenital abnormality is usually outside the ambit of group health policies.
    • A group health insurance policy will also not pay for any experimental treatments or unproven procedures.
    • Some policies cover domiciliary (at home hospitalization), nursing home or convalescent home charges whereas others expressly exclude these from group health insurance policies.
    • Any claim arising from war, natural calamity, nuclear incident or act of terror is also excluded.
    • Claims arising from any illegal activity, criminal or fraudulent acts of the policyholder or of the claimants will also not be entertained or for paid for by the health insurance company.
    • Artificial life maintenance expenses or what we call life support will also not be paid for to sustain one who is in deep coma or declared brain dead.
    • Cosmetic procedures or what we call plastic surgery is excluded from the terms of group health insurance policies; unless such cosmetic treatment is required for the treatment of accidents, burns and so on to restore functionality.
    • HIV / AIDS, sexually transmitted disease and venereal disease and treatments relating to these are outside the ambit of group insurance.
    • Obesity and treatment for obesity such as medications or surgical interventions are also not paid for.
    • Psychiatric or psychosomatic (stress induced conditions or conditions relating to the interaction of mind and body) treatments are also usually not paid for.
    • Treatments received abroad will not be paid for unless specific there are overseas treatments are specifically covered by the group policy.
    • Age related conditions such as macular degeneration and so on are also not covered by group health insurance.
    • Items of personal comfort or convenience items such as payment for a helper, toiletries, beauty services, food items and incidental expenses will usually be excluded and will not be paid for under a group health insurance policy.
    • If claims are not made in accordance with prescribed procedures and notice as required is not given to the insurance company, the company is within its rights to refuse to pay or to delay reimbursement of a claim.
    • The coverage of a group insurance policy will cease as soon as the covered individual leaves the employment of the policyholder.

    As stated above, these are some general inclusions and exclusions of group health insurance. These may vary significantly from one to another policyholder /employer, since the policies may be customized for smaller or larger corporations and may be suitably amended to cater to specific industries or the nature of work entailed.
    Who All Are Covered Under Group Health Insurance Benefit
    Group health insurance is one type of health insurance – an insurance product under which the health of groups rather than individuals is insured. We look at who all are covered under group health insurance, who can benefit from its protection and who cannot:

    Group health insurance covers:

    The employees of any corporate entity, partnership or proprietary concern that buys a group policy will be covered by it.

    All or some employees of the organization as may be specified are covered under a group policy and continue to be covered so long as they remain in employment and as long as the policy is renewed.

    Within an organization, some employees may receive coverage (such as senior or permanent employees) while some grades of employees may not.

    The family of the employee, such as the spouse, dependent children and/or parents of the employee may also be covered under the policy if such provisions are made under the policy. It is up to the employer to decide what sort of cover to offer employees and what sort of policy to buy. In some cases, health insurance cover may be issued on a co-pay basis; where the employee pays a part of the premium to derive benefit of coverage for their family as well.

    The members or employees of certain cultural organizations or clubs can be considered as groups for the purposes or buying group health insurance.

    In some cases, a group of people who have the same bank account or credit card can also be considered as a group and a health policy may be issued for such a group.

    Employees may also come together to form a group in order to buy a health policy to derive benefit of reduced premiums and other attractive features of a group health plan.

    People with preexisting conditions may also be insured under a group health policy.

    Those covered under a group plan may be able to avail protection from the date of policy issue – there may be no required waiting period to make a claim before coverage starts.

    Group health insurance benefit does not cover these employees or individuals

    Individuals who leave employment or are dismissed from employment will cease to be covered by the group plan and cannot make claims under the policy any longer.

    Retired employees will also not receive coverage under the group plan, unless their retirement or pension package expressly provides some form of medical coverage for them and /or their family.

    Those who stop being a member of an organization or stop using a product or service will also stop receiving the benefit of the group plan linked to that organization or service.

    If an employer company fails to pay premium for a group policy or does not renew a group plan, the people insured under the policy will stop receiving coverage.

    Any employee could cease to be protected under the provisions of a group plan at any time if the employer chooses to discontinue the policy or to withdraw the health care perk. The health plan can also be amended to cease offering coverage to the family members of the employee if the employer so wishes.

    A change in the terms and conditions or the coverage features of a plan could mean that fewer employees are covered under a group plan or that the (previously covered) family members of an employee are no longer covered under a plan.

    Since protection under a group health plan ceases along with employment, experts always recommend that even those who have the benefit of group health insurance at their place of work should purchase individual group insurance policies.
  • Q: What is a group health insurance policy?
    A: A group health insurance policy is the contract between the employer or policyholder and the insurance company who provides insurance coverage. The policy document outlines the features of the policy, inclusions, exclusions and all the terms and conditions and fine print of the policy.
    Q: How is group health insurance different from other types of health insurance?
    A: Whereas other types of health insurance policies are issued for insuring individuals, spouses and dependent family members, group policies are meant for groups. They are issued for groups of employees, members of certain associations, cultural groups or groups of people who use the same financial products such as credit cards, bank accounts and so forth.
    Q: What is employee health insurance?
    A: Employee health insurance is more or less the same as group health insurance and both terms are often used interchangeable. The only difference is that group health policies is a broader term than employee health insurance and may be issued for groups of people other than employees as well, in some cases: members of an association, users of certain financial products for instance.
    Q: What does group health insurance cover?
    A: A typical group health plan will cover hospitalization of all covered individuals: room rent, specialist consultations, diagnostic tests, prescription medications, nursing charges, surgical charges, anesthetist charges and so on. Costs incurred 30 days prior to hospitalization and 60 days post discharge, prosthetics, recovery aids and so may also be covered. Many group policies offer maternity expenses as standard features.
    Q: Can you avail cashless facilities under group health insurance?
    A: Yes, covered individuals and their families (if applicable) can avail cashless facilities from all network hospitals with which the insurance company has tie ups. However, non network hospital claims could be subject to co-pay in some cases.
    Q: Can group health insurance policies be customized?
    A: Group health policies are highly customizable in terms of the number of people covered and the sort of features offered. Group policies can cover critical illnesses, preexisting diseases and can also offer compensation for day care procedures that do not require 24+ hours of hospital stays if the policyholder opts for such coverage. Group policies will offer coverage to the extent employers and insurance providers have negotiated between themselves and the terms finalized between them.
    Q: Do group policies offer riders/ add-on features?
    A: Yes, group policies can be structured to offer the sort of coverage required by the size of the organization, the nature of work that the employees are engaged in, the average age and overall health of the employees. Employers and corporate entities can also opt for accidental death cover or disability compensation, particularly if employees are engaged in activities that carry high risk of accidents or involve hazardous processes and the handling of toxic materials.
    Q: How is group health insurance premium calculated?
    A: Under a group health policy, one single premium is payable for a composite policy that covers multiple individuals (and their families in some cases). Premiums will be calculated based on the number of people in the group, their age, the nature of work, the policy features opted for, and other factors.
    Q: Can one buy individual health insurance when they are covered by a group policy from work or have some other type of health insurance?
    A: Yes, individuals can buy individual health insurance policies even when they are insured by their employer or company or other organization. In fact, experts recommend that individuals should purchase an individual policy to provide an additional layer of security even when they are covered by a group policy.
    Q: Who can buy group policies?
    A: Employers, companies, proprietary or partnership firms can buy group health insurance for any or all employees of the organization and/or their families. Banks, cultural institutions and clubs may also buy group health insurance policies for specified groups of people. Groups of employees can also get together to negotiate and buy a good health policy for themselves in some cases.
    Q: Can individuals buy group policies?
    A: No, group health insurance is meant only for groups. Individuals may be interested in buying group policies because of the attractive premiums; however, companies will usually not sell group policies to individuals.
    Q: What is the maximum and minimum number of people who can be insured under a group health plan?
    A: Though group policies are generally issued for groups of about 20 people, that number may be increases or decreased as required. Some insurance companies issue group policies for groups as small as 8 people. Group policies can also have hundreds of people covered under a single policy.

    In some cases, the family members of the employer or the employees could be added to the group policy to get a better deal from the insurance company in terms of coverage as well as premium payable.
    Q: What are the benefits of buying group policies?
    A: There are several specific benefits of which group health insurance:

    • The premiums of group policies are significantly lower when compared to the aggregate premium amounts of individual policies for the same number of people.
    • Companies that buy group health policies are able to offer health insurance cover to their employees – offering peace of mind to the employees and helping to increase morale and overall productivity.
    • Health insurance is an attractive perk that employers can offer. It helps to attract new talent to the organization and also helps retain talented and productive workers within the organization.
    • Group policies are customizable and can be tailored to the needs of an organization regardless of its size, the number of employees, the nature of work, the budget and average age of the workforce
    • Employers and companies can derive tax benefit for the purchase and renewal of group health policies
    • Group policies can offer coverage for preexisting illnesses as well.
    • Group health policies can be designed to extend coverage to help secure the health of the families of the employee, such as their spouse, aged parents and dependent children.

    Q: What are the limitations of group health insurance?
    A: Group health cover ceases as soon as a person leaves, or is dismissed from service. The employer can amend or discontinue a group policy at any time. If the employer fails to renew a policy, it may lapse and coverage would cease. In the event an employee would be left without adequate coverage or any health coverage at all. It also ceases when a person retires from service unless health coverage is a part of a pension of gratuity package.
    Q: Are health checkups required before issuance of a group health policy?
    A: Usually, insurance companies do not require individuals to undergo health checkups; particularly if they are below 50 years of age. Medical checkups are typically waived in lieu of declarations of good health made by the employer and/or individuals covered by the policy. However this may vary from company to company.
    Q: What other types of group health insurance are available?
    A: Some companies prefer to create a pool for self insurance of their employee health rather than buy a policy from an insurance provider. So this type of self insurance is another type of group health insurance where, instead of paying a premium to a third party service provider, the company keeps adding amounts to a common pool which pays for hospitalization of employees, their families and so on.
    Q: What are the exclusions of group health insurance?
    A: The following are generally excluded from group policies –

    • Group policies will usually not pay for AYUSH (ayurvedic, yoga, unani, siddha or homeopathy) treatments unless expressly offered or opted for under the policy. Alternative treatments, complementary therapies based on pseudo science, experimental or unproven therapies will also not be paid for.
    • If an illness or accident is a result of fraud, illegal activities, the result of illegal drug use or due to the influence of intoxicants, group policies will not pay for these.
    • When incidents occur as a result of negligence or the dereliction of duty, claims will not be upheld.
    • Cosmetic treatments, obesity procedures and any kind of plastic surgery are usually outside the ambit of a group health policy.
    • Group health policies will also not pay for congenital abnormalities, assisted reproduction procedures or sexually transmitted diseases
    • Preexisting diseases and critical illness will not be covered unless expressly opted for by the policyholder.

    Q: What is the procedure for making a group health insurance claim?
    A: The covered individuals must submit their health card, ID proof and proof of employment if required. Proper notice within the prescribed time and in the prescribed format must be given to the insurance company or the TPA (third party agent) for cashless claims as well as reimbursement claims. In the case of reimbursement claims all original documents need to be submitted to the TPA or insurance company. If an individual is making a claim under their employee health insurance policy as well as their personal policy, proper disclosures must be made to this effect.
    Q: Is it possible to port a group policy to an individual health plan?
    A: Not only does the IRDA permit the porting of health policies from one to another service provider without loss of benefits that have accrued on the policy, the IRDA also permits people to port from group to personal health insurance policies. Hence the benefits such as no claims bonuses and waiver of waiting period for making claims on all or preexisting illnesses can, in some cases, be ported from a group policy to an individual policy.
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