It is a good move to offer group health insurance to your employees. In fact, this insurance will not only help you keep your employees motivated, but it will also help you save taxes. While it is beneficial to have group mediclaim insurance for your employees, there are some ways through which you can negotiate the best price for group health insurance:
Key Takeaways
The Power of Numbers: As seen in the case of R.J. Automobiles, a large workforce (500+ employees) acts as a powerful bargaining chip. Insurers are more willing to lower per-life premiums to secure a high-volume contract.
The “Young Blood” Discount: Companies like L.S. Digital benefit from a younger age profile. Since employees under 40 are generally healthier, the perceived risk is lower, allowing for lower upfront premium quotes.
Comparative Research: Never settle for the first quote. Approaching multiple insurers or using an advisor ensures you see the full range of market pricing and feature sets.
Feature vs. Price: Negotiation isn’t just about the lowest number; it’s about ensuring the “Scrutinized Coverages” actually meet employee needs while remaining affordable.
Data-Driven Negotiation: Having clear data on employee ages and previous health trends (if applicable) allows an employer to present a “low-risk” case to the insurance company.
1. A number of employees:
If the number of your employees is large, you can ask your group mediclaim insurance to offer discounted premium rates. Most of the group health insurance companies would be keen to offer you this policy at a better discount. In case there are good numbers of employees
2. Age of employees:
Though ailments can strike even a young person; you can ask for discounted group health insurance premium rates if your workforce consists of people below the age of 40. Young people may not fall ill frequently, and therefore, there would be fewer health insurance claims. This fact can help you get better rates.
3. Market Research:
There are various insurance companies in India, and each one of them is offering different group health plans with varied features. In order to get the best group mediclaim insurance price, make sure to make a proper comparison among the available options in order to find the economical pricing. To choose the right insurance policy from the available options, you can exercise any of the following two options:
- Compare the group health insurance on your own- If you exercise this option, you would have to approach different group medical insurance companies on your own and ask them to submit their quotes. Then you would have to compare them and find the apt plan as per your needs.
- Take the help of corporate insurance advisors- You can approach a corporate insurance advisor, like SecureNow, who would help you choose the right group health insurance from the available options. You would only need to submit some basic details about your requirements, and the advisor would recommend multiple insurance options as per your need. It won’t only save you time, but also help you find the right group mediclaim policy as per your need.
Case Study: 1
Over the last five years, R.J. Automobiles has carved a niche for itself in the automobile industry. Backed with more than 500 employees, the company has offices situated in different parts of India. Last year, the company bought a group health insurance policy from Insurer A.
Before buying the insurance policy from Insurer A, R.J Automobiles carefully compared all the available options. As the company was buying insurance for its 500 employees, it was looking for an affordable option.
The HR department of the company asked for insurance quotes from different group health insurers in India. And then compared all of them to find the right insurance policy for its employees. Considering the number of employees, Insurer A agreed to offer low premium rates. The HR department of the company scrutinized the group health insurance policy coverages offered by Insurer A. Only after being satisfied with the offered features, R.J Automobile bought the policy from Insurer A. It was the number of employees due to which R.J Automobiles was able to get low premium rates on its insurance policy.
Summary Table: Negotiation Levers for Group Health Insurance
Case Study: 2
Though it’s been only one year that L.S Digital Company has come into existence. But the company has successfully managed to grab the attention of big brands. Running on the ‘young’ blood, the company is now planning to offer group health insurance to its employees.
Since most of its employees are young, the company can negotiate with an insurance company and go for a low premium rate/price for group health insurance policies. Though there is no guarantee, however, young people usually do not fall sick frequently. And therefore, they would not use the insurance policy frequently.
Here, the age of the employees would play a major role, and L.S Digital Company would be able to easily find a group health insurer offering discounted premium rates on the insurance policy.
Frequently Asked Questions (FAQs)
1. Is there a minimum number of employees required to start negotiating for discounts?
A) While even small groups can get competitive rates, significant “bulk discounts” typically kick in once a company has more than 50 to 100 employees. However, startups with as few as 7–10 members can still negotiate based on a very young average age.
2. If our workforce is young now, will our premium automatically stay low forever?
A) Not necessarily. As your employees age or if the company experiences a high volume of claims in a particular year, the insurer may adjust the premium during the annual renewal. This is why ongoing wellness programs are helpful.
3. Should we prioritize the lowest premium or the best features?
A) A balance is essential. A very cheap policy might have “hidden” sub-limits on room rent or specific disease exclusions. Always ensure the policy covers critical needs (like maternity or pre-existing diseases) before finalizing based on price.
4. How does a corporate insurance advisor help in negotiation?
A) Advisors have access to multiple insurance providers and understand the “underwriting” logic of each. They can package your company’s data in a way that highlights low risk, helping you get rates that might not be available if you approached the insurer directly.
5. Can we negotiate the premium mid-year if we hire more people?
A) Standard practice is to pay a pro-rata premium for new hires based on the already negotiated rate. However, if your workforce doubles in size mid-year, you can use that increased volume as leverage to negotiate even better terms during the next renewal cycle.
About The Author
Mayank Sharma
MBA Finance
He is a professional who brings extensive knowledge and expertise to the field of group health insurance. He has dedicated 7years to helping individuals and businesses navigate the complexities of insurance. Having worked closely with numerous clients and insurance providers, he deeply understands the nuances of group health insurance policies. With a reputation for providing insightful and informative content, he leverages his industry experience to educate readers about the importance of group health insurance and its benefits. Through their articles, Mayank Sharma aims to empower individuals and businesses to make informed decisions about their healthcare coverage, ultimately promoting healthier and more secure communities.
