What You Need To Know About Group Health Insurance

What You Need To Know About Group Health Insurance

What is Group Health Insurance?

Group health insurance is designed in such a manner so as to offer comprehensive healthcare coverage to people belonging to a particular group.

The so-called groups formed for this purpose could be either employer-employee groups or non employer-employee groups as per the group insurance guidelines given by Insurance Regulatory and Development Authority of India (IRDA). Holders of the same credit card, holders of savings account of a bank or members of similar social or cultural association etc. are a few examples of groups.

How useful are Group Health Covers?

When it comes to group health insurance, you are not asked to submit any medical reports, plus there is no waiting period and you also get coverage against pre-existing conditions, thus making it the most sought after health insurance plan. Its reasonable premium is yet another major factor that makes it beneficial.

The most common form of group health insurance is the one that is offered by employers to their employees. This type of group health insurance generally offers health care coverage to the employee, spouse, dependent parents and dependent children up to certain age.

One must take note of the fact that it is not necessary that each and every employer to offer group health coverage to its employees.

You can avail the benefits of group health plan only when your employer is offering it. As an individual, it is not possible to voluntarily opt for a group health plan.

How does a Group Health Insurance work?

The core nature of a group health insurance policy is that a master policy is issued which offers coverage to each and every individual of the group for which the policy has been bought. In a group insurance plan, the terms and conditions, inclusions as well as exclusions are same for every individual being covered under that very plan.

Almost each and every insurance company in the market today offers Group Health Insurance, but every company has its own set of rules that it abides by. The inclusions and exclusions may differ from one insurance company to another.

However, one must take note of the fact that a lot of customization goes into designing a group health insurance policy. It’s the company agent and insurance company who work out and customize these group policies on the basis of what the customer needs and the financial viability of that particular product.

How is Group Health Insurance different from Individual Health Insurance?

As the name suggests, a group health insurance plan is meant to offer heath care coverage to a group of people. Whereas, an individual health ins4urance plan is designed to offer coverage to an individual alone. In addition to this, under an individual insurance plan, every individual has a separate renewal date, whereas under a group plan, there is no need to remember various renewal dates, as there is only a single renewal date.

Where on one hand a group health insurance plan can be customized up to a certain limit, on the other an individual health plan can be completely customized so as to cater to the needs of an individual by adding or removing a few policy riders.

Under a group health insurance plan, each and every individual is given health care coverage despite their pre-existing conditions. Whereas, when it comes to an individual health insurance plan, an individual’s application can be rejected on the basis of medical conditions. Along with this, under individual insurance, the insurance company can modify the policy on account of the medical condition of an individual. But, this cannot be done in a group health insurance plan; a group health insurance plan cannot be altered or adjusted because of an individual’s medical conditions, it will remain the same and shall offer the same health care coverage.

Advantages of Group Health Insurance

Lower Premium: The premium amount of a group health insurance plan is much lower as compared to an individual health insurance plan. This, in turn proves a group policy to be a cost effective one. According to a study, a group health insurance plan is 30% cheaper than an individual health plan.

Maternity Cover: A group health insurance plan offers an individual with complete maternity benefits from the day one, whenever the person is enrolled in the policy.

Waiting-period: A group health insurance plan has no waiting period in order to avail full benefits of a health care plan as there exists in an individual health plan.

No Medical Check-up required: When it comes to group health insurance, it is not necessary for an individual to submit his or her medical checkup reports in order to get enrolled under the group health plan, as the case is with individual health insurance.

Disadvantages of Group Health Insurance

Leaving the Job: One of the major disadvantages of a group health plan from your employer is that, what if you leave your job and shift to some other company. Not only will your health cover cease to exist, but you will have no health cover in case your next company does not offer any health insurance to its employees.

Policy Discontinuity: Once you leave your job and are no longer associated with the company, the policy you were enrolled under will come to an end and so will its benefits. This is yet another disadvantage of a group health insurance plan. However, in some cases, an employee has the choice to buy the very same policy with similar benefits. And, if such is the case, he or she should definitely opt for it.

Most MNC’s provides its employees with health insurance. Some may offer health care coverage for not only you but your spouse, dependent children, dependent parents as well as your in-laws. Health cover provided by employers may vary from one company to another. After all each and every company has a different health policy for its employees. Also, one needs to be aware of the fact that some companies allow its employees to opt for health cover for their respective family members by paying a little extra.

Getting a health care cover from a company is the most cost effective way of having your loved ones covered at all times; or at least until you have your job.


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