How Does Group Health Insurance Cost Employer Per Person?

Various factors influence the cost of group health insurance for small businesses. Having proper knowledge of these factors helps employers make informed financial decisions and also helps employees understand the driving factors behind the cost of their health coverage.

Add-ons

Customised healthcare plans with coverage for specific diseases and additional benefits lead to higher premiums due to the extra benefits. Employees usually cover the basic premiums, and employees can opt for optional add-ons by paying the additional costs.

Claims History

Frequent claims by employees can increase renewal premiums. On the other hand, if there are no claims in a year, policyholders might receive discounts. Insurance providers adjust premium amounts based on the previous year’s claim history to gauge the risks and costs of the converge.

Dynamics of the Group Insured

The age groups and medical history of the insured group significantly impact small business health insurance costs. If an organisation’s employees are generally older or have pre-existing medical conditions, the premium rates are bound to be higher than the average cost of group health insurance.

Insurance companies tend to charge more for groups with a higher age average and a history of medical claims. This is because these groups are more likely to require medical services. For instance, if most employees are over the age of 40, the annual renewal cost of the insurance will increase due to the higher likelihood of insurance claims.

Group Health Insurance Features

Group Health Insurance plans with extensive features like daycare treatments, outpatient department (OPD) expenses, and global coverage, come with higher premiums due to their comprehensive coverage. For instance, policies offering broad coverage under group health insurance India are less expensive than those providing international healthcare coverage.

High-Risk Coverage

Group Health Insurance plans that offer special benefits for accidents in high-risk jobs tend to have higher premiums due to the comprehensive coverage they provide. Including coverage for medical emergencies that arise from workplace accidents, these plans tend to offer various additional benefits which leads to higher premium costs.

Pre-existing Diseases

The coverage for pre-existing conditions typically leads to higher premium costs. Insurance companies charge more to cover chronic diseases like diabetes, which increases the likelihood of claims. This ensures that the insurance provider can meet the expected costs of frequent and potentially expensive medical treatments.

Total Number of Policyholders

The total number of employees covered under the employee insurance policy also affects the overall premium rates. Larger organisations tend to pay more due to their large number of employees. However, with the right financial planning, they might benefit from economies of scale.

If a significant percentage of the workforce has pre-existing conditions or falls within higher age brackets, premium rates will increase. Employers need to consider the size of their workforce and their health profiles when selecting a group mediclaim policy.

Treatment for Critical Illnesses

Group Health Insurance plans that offer extensive coverage for critical illnesses, such as heart diseases or kidney ailments, generally cost more. Policies including specific treats also tend to have higher premiums. To manage costs, some employers opt for basic coverage and allow employees to purchase add-ons for additional benefits.

Shorter Waiting Periods

Group Health Insurance plans that offer shorter waiting periods for claim eligibility often have higher premiums. Most policies have a waiting period of around 24 months for certain conditions. Policies with shorter waiting periods allow quicker access to benefits but at a higher cost.

Sum Insured

The total sum insured under a policy directly influences the premium rates. For instance, most small to mid-sized companies offer coverage between ₹1 Lakh to ₹3 Lakhs per employee. The premium increases as the sum insured increases.

The average cost of group health insurance premiums ranges between ₹10,000 to ₹25,000 per person. Costs of the group health insurance vary based on coverage levels and the company’s budget. Basic plans that cover essential services cost less, while more comprehensive plans naturally cost more.

Since the group medical insurance for employees in India can vary due to an array of factors involved, the average cost of group health insurance lies somewhere between ₹5000 to ₹20,000 per person.

Younger and healthier employees may secure more affordable plans with basic coverage while older employees or those with pre-existing conditions may require comprehensive plans. The annual premium cost of the latter increases mainly due to the extensive coverage for specific illnesses as well as the greater need for medical attention.

To conclude, since a group mediclaim policy is an essential SME insurance policy for both the organisation and the employees, financial planning around investing in a group health insurance is of paramount importance.

Employers need to consider various factors and ensure that the benefits of a group medical insurance policy can be offered to the workforce to maintain their well-being. Investing with a reliable insurance provider like Tata AIG offers a stress-free purchase process as well as various additional benefits.

A group medical insurance policy not only offers indispensable financial stability during challenging times but also ensures seamless reintegration of the workforce upon recovery. This helps
organisations retain valuable talent and employees their job security. It is precisely factors like these that make group health insurance such a valuable asset for organisations.

Do employees require a medical check-up for group health insurance?

No, medical check-ups are not required for group health insurance.

What is the waiting time for coverage of pre-existing diseases under group health insurance?

Pre-existing diseases are covered from day one of the activation of a group health insurance.