What are the features of Group health insurance?
A group health insurance plan is quite popular among groups as the plan provides health insurance coverage at very affordable premiums. Individuals who are a part of a group get automatically covered under the policy if the group buys a group health insurance plan. A group health insurance plan is quite different from an individual health plan. Let’s understand some of the salient features of a group mediclaim plan which makes it unique –
- Relevance – a group health insurance plan is available only for recognised groups. Groups like employer-employees, trade unions, clubs, associations, etc. can buy a group health insurance plan for their members. The plan can be bought by groups who are already in existence and not by those who are formed for the purpose of buying insurance.
- Nature – in a group health insurance policy, different policies are not issued for different members. A single policy is issued which is called a master policy. All the members who are covered are named in the policy with their respective coverage levels.
- Ownership – the group health insurance plan is issued in the name of the group. The group, therefore, acts as the policyholder while the covered members are called beneficiaries. So, if a company, say ABC Private Limited, buys a group health insurance plan for its employees, the policyholder would be ABC Private Limited while the insured members would be the employees.
- Sum insured – the sum insured for each member is determined by the insurance company. The members or the group cannot decide the sum insured which it wants.
- Premiums – premiums of group health insurance plans are relatively low and hence affordable. They can be paid by the group itself, by its members, or partially by the group and partially by the members. The insurance company, however, collects the lump sum premium from the group which is the policyholder.
- Pre-entrance medical check-ups – group health insurance plans have simplified underwriting guidelines. Irrespective of the age of the insured members, no pre-entrance medical check-ups are required.
- Waiting period – group mediclaim plans have minimal or no waiting periods. Pre-existing illnesses are covered from the first day of the plan itself.
- Cashless treatments – if the insured member takes treatments at a network hospital, group health insurance plans allow cashless settlement of claims.
- Policy tenure – a group health insurance plan is offered for one year. After the coverage period is over, the policy can be renewed. Upon renewal, fresh underwriting is done before the coverage is allowed to continue. The sum insured and the premium can change during renewal
- Coverage for dependents – under many group health insurance plans, coverage can be taken not only for the group members but for their dependents too. Dependents could include the member’s spouse, dependent children and dependent parents.
- No co-payment clause – in individual health insurance plans, if the insured is aged 60 years and above, a co-payment clause is applicable. Under that clause, a part of the claim is borne by the policyholder. However, group health insurance plans have no co-payment clause. The policyholder is not required to bear a portion of the claim as the insurer settles the claims in full.
These features make group health insurance plans unique and different from individual health plans.
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