While most group health plans need a minimum of 20 members, many early startups usually have only 8-10 employees. If you are an owner of a startup then you might be contemplating the possibility of getting a group medical insurance policy. However, startups can always opt for a group plan which covers both the employees’ and their immediate family members to reach the minimum limits required by the insurer.
There are several advantages to the family members being covered under group health policy, over the individual insurance policy:
|Premium Cost||Group medical policies premiums are 20-30% lower than individual policies for the same age.|
|Medical Tests||No medical tests required for anyone to be covered.|
|Pre-existing Conditions||Any pre-existing condition, unless explicitly excluded is covered from day one.|
|Maternity Cover||Maternity cover is included as a part of the policy.|
A Case of Selecting Group Insurance for a Startup
Alphase Tech Solutions is a successful startup which started 2 years back in 2018. Based out of Bangalore and with an employee strength of 15, it offers software development and consultation solutions to its global clients. It has good growth potential with several hardworking employees who put in long working hours each day. The company is now contemplating getting a group medical insurance policy for its employees, but is doubtful if it is even possible to buy a group policy for a startup of only 15 employees.
After consulting an insurance advisor the company discovers that despite being a startup, it is possible to buy a group medical plan for its employees.
- AlphaseTech Solutions can get a group health plan which will cover both their hard-working employees and their immediate family members, hence meeting the requirement of a minimum 20 people. Moreover, an individual is more likely to continue working in a company if their family too is in favor of the benefits accrued from the job.
- The expense of a group health plan may seem larger to a startup as compared to other bigger companies. However AlphaseTech Solutions can take advantage of tax benefits, for the extra amount they will spend on the employee group insurance.
- Counting the family members with the employees if the group plan is for 30 members while taking the policy, then even if the members reduce to only 20 members by next year, the policy will continue with a reduced premium.
- AlphaseTech Solutions is in a growth phase and expects to increase its business size as well as the number of employees. In case the employee strength increases from 30 to 100 by next year, then the premium amount will also increase. But the company will also be eligible for a bonus such as a premium discount, if no claims have been made in the previous year.
It is not only possible for AlphaseTech Solutions to buy a group health insurance, but this also helps the startup retain its most valuable assets in this growth stage – its employees. Additionally, the group health plan brings the employee benefits policies of this startup closer to its larger counterparts.