Group Health Insurance

Usually, the insurer does not place a limit on how many times an employee list can be amended, and the employees’ names and details can be added or removed from the policy any number of times throughout the year.

The relationship manager assigned to the insured firm or group can be requested to update the list on a daily basis or as convenient for the firm. Usually, the turnaround period for the request is 24 – 48 hrs. and employers and group administrators should consider this time while forwarding the request.

Logically it will be preferable for the insurer to receive requests at regular intervals like weekly or monthly, instead of getting bombarded with daily requests. However, recruitment processes in some firms may lead to just that frequency.

Types of Employees/Workers Covered

Group health policies generally only cover full-time workers and employees. This is done to avoid risk of adverse selection by the insurers. Following categories of employees or associates are not covered by the group health policies:

  • Contractual workers
  • Third Party Consultants
  • Board of Directors

Contractual workers and employees can be covered by other provisions like ‘Worker’s compensation Insurance’, and only eligible to receive benefit as a compensation for an injury at the employer’s premises.

Therefore, firms employing contractual workers need to maintain and inform the insurer about the number of contract workers only in case they have liability insurance policies like Workmen Compensation Insurance or Office Insurance (with third party liability cover).

Similarly, board of directors are not covered under group health policies meant to cover employees, as they are considered self-employed from the perspective of the insurer. However, directors who are working on remuneration basis on the board of companies can be considered for employee health coverage of the firm.

 

Case on Updating Employee Information with Insurer

TVN Resource Personnel Ltd. is one of the largest human resource firms in the country and manages the HR operations for several listed companies. Many of these companies are continuously involved in the hiring of employees and workers.

Given the attrition rate in some industries, many of the workers and staff switch jobs throughout the year. One of the greatest challenges TVN  face is updating the group insurance records of the employers along with processing appointments and final letters.

The CEO of TVN, Ruchir Chaddha, estimates that on an average more than 8,000 names are updated on a daily basis with about seven major group health insurers. In peak season this number can go up to 15,000 a day. This is one extreme. 

Case of Frequent Recruitment

TBS Ltd. is an MNC operating in customer service domain. Currently, it employs approximately 10,000 employees across the country and is rapidly expanding. CEO of TBS, Meera Ramineni expects the employee strength to double in five years.

This reveals interesting data about the company’s future human resource needs. The firm will be recruiting close to 2000 people a year for next five years. That is only to cover the new positions, but to cover their attrition rate of 10% a year they will have to recruit close to 3000 new workers each year.

That is more than ten selections a working day. The HR head for the firm, Shrisangeeta Krishnan, reveals that people are usually hired in batches of 20 – 30 and then trained together. This is also a continuous process, as the firm cannot afford a shortage of the staff, and keeps another batch of 20 – 30 ready for joining in case anyone leaves during training.

The HR executives need to update and remove names of employees in about this number every day form various group insurance and other employee benefit policies. The group health and pension policies along with the term life policies are the most applicable employee benefit schemes in the company.

Additional Read: What are the advantages of a Group Health Insurance?

The group health insurer for TBS allows daily update of the names and employee codes of the covered members. This facility also makes life easier for TBS staff and puts TBS in a competitive position vis a vis other players in the same domain for talent acquisition.


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