Types of group insurance schemes available for SMEs

Small and medium scale enterprises may have a small work setup, but when it comes to keeping the employees happy, they can do wonders. Experts in their respective fields, SMEs may find some loopholes at the administrative end that can be resolved by taking different types of insurance policies. Such policies are beneficial for the employers and the employees both, as the coverage increases while the amount paid for them gets shared.

India had around 48.8 million SMEs by the year 2013, employing 40 percent of the country’s workforce approximately. With so many informal workers employed in this sector, it is even more important to make them feel as an important part of the system by providing them exclusive coverage under different group insurance plans.

An SME with even as small as 5 employees can go for different group insurance schemes that can make the workforce feel safe and secure in the work environment.

Group medical insurance

The group medical insurance policy provides many other benefits that individual employees cannot avail on an individual basis, such as, inclusion of even pre-existing diseases. With group medical insurance schemes, there is no waiting period for certain diseases to be covered, and the coverage for maternity is also provided on an immediate basis. A customized insurance coverage can be enjoyed only with the group medical insurance scheme, making the employees of SMEs feel more secure when it comes to health. Further, the cost of such group medical insurance plans is quite low for any SME, and can be faced without any stress.

Group term life insurance

SMEs can retain their key men by providing them the exclusive coverage under group term life insurance that will also include the wellbeing of their family members. Small companies may have a limited budget but can do extensive market research to figure out a group term life insurance that can best serve the responsibilities of their employees even if they die due to an accident during their course of employment. The group insurance cover can also play a major role in creating a pool of funds to meet the expenses for gratuity and superannuation plans. Such plans are valuable for long-term retention of key employees, and can be easily formalized with group insurance.

Group personal accident insurance

Many group personal accident insurance policies cover not only the accidental death, but also the medical expenses along with partial and total disabilities. This group insurance policy helps employees and their families by sharing a major part of the financial burden in case of any accident during the course of employment. In the cases of such accidents in which the employees don’t need to be hospitalized, only a group personal accident insurance can help in meeting the expenses, such as doctor’s fee and treatment charges.

Workers compensation insurance

SMEs that are involved in such processes, which make employees more prone to accidents and physical injuries, need to have workman compensation insurance under the Workman Compensation Act 1923. In manufacturing and construction units where even as less as 20 workers are employed, the worker’s compensation insurance is mandatory to cover occupational diseases, accidents and injuries during the course of employment. Partial and complete disablement along with death at the workplace is also covered under this group insurance plan.

Public liability insurance

Accidents and injuries come without saying in many of the cases, and this may lead an SME to pay a hefty amount as compensation. Public liability insurance is one of those insurance plans that are beneficial for the employers, especially in the case of SMEs. As small and medium enterprises work with the budget constraint, they need the public liability insurance even more to face the challenges of liability claims. Claims can be made by the clients or the public against the financial loss, property damage or physical injury because of any product or service.

With SMEs becoming more employee-centric, the need for group insurance policies is felt even more. Such policies play a major role in attracting new talents, while retaining the existing ones for long. A preferred solution for the high attrition rate of employees is group insurance plans, which make employees enjoy default benefits of being a part of an enterprise.

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