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Group Health Insurance

Is Group Health Insurance Mandatory for Employees in India?

By December 1, 2021January 22nd, 2022No Comments
Is Group Health Insurance Mandatory for Employees in India - PlanCover

A group health insurance policy is a form of non-life insurance policy that is applicable for a group of employees working in a company. Each employee who is under the scheme of the insurance policy equally benefits from it. Moreover, the employer gets a wide range of benefits by purchasing the policy. Continue reading the blog to know more details.

It is mandatory after the pandemic

The Indian Government has made it mandatory for companies from every business domain to arrange for a group medical insurance policy for their employees. Currently, it is a regulation. Each company operating in India has to abide by the rule. So the simple answer to the question that whether group health insurance is mandatory for employees in India is YES.

An Employer Pays All of the Premiums

The usual norms of the group medical insurance policy are in favour of both the employees and employers. The employer needs to pay the premium amounts each month (or annually in some cases). Generally, the employees do not have to worry about contributing to the premiums. The employer takes responsibility in such cases. Availing of medical insurance becomes lucrative for the employees.

The policy aims for a basic coverage

The fundamental features of the insurance policy give basic coverage to the employees. There are certain cases in which the families of the employees also get partial benefits from the insurance policy. The employer needs to enquire about further details from the service provider.

IRDAI has made it mandatory

The Insurance Regulatory and Development Authority of India (IRDAI) has clearly made it mandatory for companies to buy group medical insurance policies for their employees. It is an obligation that companies in any sector have to strictly maintain. There is no exception in this case. 

The directions after lockdown

After the lockdown, the companies have been instructed by the concerned authorities to undergo the simple process of providing group medical insurance to the employees. The procedure falls within a regulatory framework known as ‘Standard Operating Procedure’. It simplifies the implementation of the insurance policy, registering name of each employee.

IRDAI directed the insurance service providers, too

The different companies providing insurance policies were also given guidelines by the IRDAI. The instructions simply told about making the group non-life insurance policies simple and east to apply, benefitting both the employees and employers.

Employee State Insurance and Group Medical Cover

As an employer (or an employee), you need to be aware of the basic aspects of both employee state insurance and group medical cover. When you have clear ideas about the insurance policies, you can go ahead and make a final decision.

An employee whose monthly salary is below Rs 21,000/-, is eligible for the employee state insurance. On the other hand, an employee whose monthly salary is more than Rs 21,000/-, is eligible for the group medical cover.  

As the owner of a small business, you need to talk to the insurance provider about more details. If you are the HR head of your company, then get in touch with a broker who has experience in selling various types of insurance policies.

The amounts of premiums to be made

Each policy has different terms and conditions. As an interested party who plans to purchase the policy, you need to thoroughly read the policy document. 

The premium amounts vary according to the conditions laid by the policy document of the specific insurance service provider. Before buying the policy for your employees, you need to get clear ideas by discussing it with the seller.

Full contribution

As an HR executive of a company, it is your responsibility to understand the nature of contribution while availing of a group medical insurance policy. When the insurance is fully contributory, the company needs to pay the full amount of the premium to the insurance provider. The employees do not have to pay anything in this case.

Partial contribution

There is also another type of contributory insurance policy, which is mainly partial in nature. In this case, the company or the employer pays a part of the premium. The rest of the portion is paid by the employees. The clauses and guidelines of the group medical insurance policy explain every detail.

Benefits in terms of hospitalization

The employees of an organization avail huge benefits in terms of hospitalization, especially in cases of cashless hospitalization. They do not have to bother about paying anything to the hospital. 

Post-hospitalization care

In some insurance policies, there is a provision that lets the employees avail themselves of post-hospitalization care and services free of cost. The employees do not have to be worried about bearing the costs. The group medical insurance policy takes care of everything. The employees can stay relieved about getting the required medical attention.

Covering the OPD service charges

The group medical insurance policy also covers the costs of OPD services. The employees can stay relaxed as they do not have to think about the expenses. The policy details clearly mention about the conditions that benefit the employees of an organization.

Can cover charges for telemedicine, too

Modern group health medical insurance policies can also have the facilities to cover the costs of telemedicine. Telemedicine is fast growing as a viable and practical medical service. Any support from the insurance policy means the employees can stay relieved about not spending anything in availing of telemedicine services.

There are guaranteed tax benefits

The employer gets a string of tax benefits when it buys the group medical insurance policy for the employees. More tax benefits improve the revenue margins for the company. Also, it may lead to accelerated growth of the business, even in a competitive market. 

Contact a reputable service provider

If you handle the HR issues of a company or own a small business, it would be insightful to contact a good service provider such as PlanCover that has several years of experience in selling non-life insurance policies to many companies in the industry. You can call the service provider or write an e-mail. 

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