Features of Group Health Insurance Plan

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In recent years, health and wellness have become a priority, even in the workplace. Every organization, regardless of size, understands how important a healthy workforce is to its success. The most sought after employee benefits are to retain employee productivity, including attracting new talent. An individual policy for each employee can be cumbersome, expensive and impractical, explaining the growing popularity of group health insurance plans. The following article explains about employee health insurance plans and their popular features.

Meaning of a group health insurance plan

Alternatively known as corporate health insurance, it is insurance paid by companies for their employees. It applies to all employees regardless of age, job role, health conditions, and other factors. The government has also made it mandatory for organizations to resume operations with a health policy as standard operating procedure. As employers take out these group plans, they pay for the premiums.

Features of A Group Health Plan

Here are some features of a group health plan:

Low premium

In this policy, employees get medical coverage without paying a premium. Since these policies are for a group, the risk is spread, making insurance plans economical. In addition, many insurance companies offer corporate discounts.

Tailor made

Health coverage varies with each individual and each organization. Now, there are many group health plans in the market.

Some insurance companies offer fixed coverage, while others prefer detailed coverage and optional add-ons, such as pre-existing conditions. Conducting a health survey of your employees to see what they look for in terms of health benefits from your organization will help you choose the best package. Sometimes, due to the dangerous nature of the job, they may want a group personal accident insurance. Tailoring health plans to the needs of employees increases their appreciation and loyalty.

No medical checkup

The main feature and advantage of a group health insurance plan is the absence of pre-medical checks. Before approving a health policy, every insurance company requires a complete medical examination of the insured. A high-risk medical condition increases the liability of the insurance company. Hence, they may reject the insurance application or increase the premium amount. However, in a group plan, there is no need for a medical examination. All employees, including those with pre-medical conditions, are eligible for benefits.

No waiting period

The waiting period refers to the time you need to wait before you can avail the coverage benefits. In other words, you cannot file any claim until then. It can be 30 days or 60 days or more. However, there is no such waiting period in the corporate health plan. You can reap the benefits from day one.

Wide coverage

You can get comprehensive health coverage under group plans. If you have pre-hospitalization expenses such as consultation fees, X-rays, CT scans, MRIs, or post-hospitalization expenses such as medications or follow-up tests, you can get them all back. Apart from the treatment costs, there are other expenses, such as ambulance fees and room rent. Your group health policy may cover this as well.

Cashless facility

For most medical treatment, you have to pay at the hospital. But, with a cash option, you don’t have to pay for medical expenses. The insurance company pays the hospital directly. However, you can avail this benefit only from the network hospitals of the insurance. Not to be confused with a cash benefit exchange. For reimbursement, you have to pay for the medical expenses and then claim them.

Inclusion of dependents

According to Union Ministry of Health data, health inflation has increased from 9.12 percent in January 2022 to 11.64 percent in March 2022. These rising medical expenses can create financial stress on employees. Medical problems of family members may affect their work productivity. A group medical policy relieves this burden as the benefits of these policies are not only for employees but also include dependents such as their spouse, children and parents.


Group policies offer comprehensive coverage. However, they also exclude certain diseases and medical problems. It will be an unnecessary financial strain to pay for the medical expenses covered under your insurance plan. Here are some exceptions:

  • Bariatric surgery
  • Lasik surgery
  • Rehabilitation treatment
  • Robotic surgery
  • No payment

A co-payment refers to a percentage of medical expenses incurred by the insured. In a group medical plan, employees do not have to pay any premiums. However, if they want additional coverage, they have to pay a premium for the same.

Tax deductions

When employers offer their employees any benefits in addition to salary, they are known as fringe benefits. The employer can claim tax deduction on any such benefits under Section 17 of the Income Tax Act. The group medical premium paid by the employer is a ‘benefit in lieu of salary’ or a fringe benefit. You don’t have to pay any tax on them. Also, employees cannot take tax benefits because they do not pay for the premiums. For additional coverage premium, they can avail benefits under section 80D. Under group term life insurance plans, family members can avail tax deductions on death benefits under Section 10 (10D).

last word

The above article gives a detailed explanation of the basic features of a group health insurance plan. However, it is important to understand your workforce needs, research the types of coverage available, and review your financial budget. Research the insurance company’s reputation, claim settlement ratio, hospital network, waiting period, and customer reviews next. With Plum Insurance, you can get quick claim settlement, customized plans, coverage, and complete transparency of your health plans with their easy-to-use dashboard.

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