Group Health Insurance

As a business owner, one of your objectives is to motivate your valued employees and a Group Health Insurance plan can assist you in doing this quite effectively. However, unlike the majority of employers who avail of a single group mediclaim policy covering all the employees in an umbrella cover, you might opt to be different and think about availing of multiple such plans to boost your employees’ morale. But before you do so, it is better to evaluate this and then take your decision wisely!

Availing of multiple mediclaim insurance policies for your employees can be very confusing. At the outset, it might seem to be a good idea with possibly several added benefits. But before you decide to implement it, you need to look at the pros and cons of having multiple group health plans and how it can affect your organisation in the long run.

Advantages of availing multiple Group Health Plans

Disadvantages of availing multiple Group Health Plans

Substitute cover available

  • With multiple group health insurance plans, you can ensure multiple benefits for your employees.
  • For example, one plan may not provide cover for cancer for at least one year after the employee has joined the organisation while the other plan would possibly cover the same illness without any waiting period. In case an employee requires cover for the disease before he has completed one year in service, he can always rely on the other group health plan available and utilise its medical benefits.
Difficult to manage

  • Availing multiple corporate health plans can be really difficult to manage considering the responsibility of the employers towards the organisation as well
  • It can be difficult to remember the due dates of premiums payable and renewal of policies especially if the plans have been availed from different insurers.
  • Also, helping an employee with the claims process can be a task with multiple insurance policies in place.
Increased specialised coverage

  • With multiple corporate health plans, there is more scope of provision for specialised treatments like dental and vision check-ups and remedies.
  • In a single plan, these specialised covers are not focussed upon as an employer seeks a comprehensive plan covering the needs of maximum number of employees.
Increase in administrative costs

  • Availing multiple plans will drastically increase the administrative costs to a very high level.
  • The huge increase in the premium costs makes this option absolutely out of scope for small or medium sized enterprises.
  • It might also not motivate the employees sufficiently enough as the managing multiple policies can be confusing for them.
Tax benefits

  • The premium paid for Group Health insurance plans is deductible from the taxable income, according to section 80D of the Income Tax Act.
  • Thus, an organisation that invests in multiple plans can reap its benefits financially (subject to the limits prescribed in the Act)
Limited coverage even though policies are multiple

  • It can be uninspiring for the employees if they find that their requirements are not covered in any of the Group policies available.
  • For example, suppose none of the plans availed provide immediate cover for maternity expenses and that is the requirement of most of the employees.  In such a case, there is no use of spending precious business income on multiple health policies if the specific need of the majority of the workers is not met.
Covering Different Groups

  • It is possible to have employee groups with different risk exposures; i.e. employees in manufacturing process, employees in clerical jobs, expats etc.
  • Covering all categories under one insurance would make it rather expensive and unnecessary for some employee groups
  • Covering similar risk groups should be preferred in such scenario
Problem in claims procedure

  • At the time of making a claim, an employee will not have a say in choosing the plan that must cover the expenses, which can be disheartening for them
  • There might also be unnecessary delay in the claims process due to unwanted situations like clashes between different insurance companies on who will cover the expenses.

 

Though, it is generally not advised that you avail multiple group health policies for your organisation, the advice does have some exceptions. For example, it may be beneficial for large manufacturing firms that have staff engaged in clerical operations and other staff engaged in physically demanding or other high risk tasks.

Additional Read: How to buy a Group Health Policy?

In such a scenario, it is advisable to buy separate health policies to cover the employees in two categories. Additionally, if you have employees travelling to other countries frequently you will also need international health policies to look after their health in foreign countries as well.


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