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  • Should You Rely On Group Health Insurance Or Purchase A More Extensive Cover?

    Published on January 20, 2021

    There is a sporadic rise in the number of ailments that at present one may get diagnosed. At such times, living without a backup plan is like throwing caution to the wind. But not when you invest in a health insurance plan. 

    A health insurance cover helps you mitigate the financial costs that you might incur in times of hospitalisation, whether planned or sudden. With a periodic payment of a premium amount, you can insure your health in the long run. There are two broad categories of health insurance plans you can buy – group insurance plan or a regular insurance cover. 

    What is a group health insurance policy?

    Group insurance plans are where a set of individuals associated with an entity or organisation are offered insurance coverage. It is most commonly observed in corporates. These corporate entities offer their employees insurance cover as an additional perquisite over and above their compensation. These insurance plans cover a varied list of ailments that are more commonly faced by the majority. 

    What is a regular insurance cover?

    Unlike a group insurance cover, these insurance plans can either be purchased individually or for your family. A regular insurance plan offers flexibility and freedom to customise the policy based on your requirements. Family health insurance is a prime example where different coverage can be opted to meet the medical needs of your family. Senior citizen insurance plans, individual health plans, critical illness insurance are other types where coverage can be customised too. 

    How does a standard insurance cover differ from a group insurance policy?

    Premium: Group insurance plans are cost-effective policies. As a large number of individuals are insured together, these policies have lower premiums when compared to other types of plans. Although they have limitations with regards to customisation, sub-limits, capping and co-payments. A standard insurance policy is customisable to fit your needs for which it costs marginally more than a group insurance plan.

    Cumulative bonus: Standard insurance plans are eligible for cumulative bonuses wherein the sum insured increases for no claims made during a policy tenure. It is a form of reward by the insurance company that provides added benefits at renewal date. However, a group insurance cover lacks these advantages even if no claim no is made during the previous policy period. 

    Customisation: When purchasing a group insurance plan, the benefits are opted by the management and customisation isn’t possible based on individual member’s needs. Although a few features can be opted, yet there are limitations when you compare health insurance plans otherwise.

    Which policy should you purchase?

    If you are someone who is strained on their finances, a group insurance plan may seem a better alternative than not having one. On the other hand, if you can manage to shell out a couple of thousands, a standard health cover will help you avail broader coverage and a higher value for money. Often individuals overlook the key limitation of group insurance cover that it is associated with your employment. The time you change your employer, you lose all your policy benefits. At such times, you might be required to opt for insurance cover at a higher age. 

    To conclude, make a note of your medical preferences and accordingly check which type of policy fits your requirements. Backing up a group insurance plan with a standard insurance cover is the best practice that protects you in the long run.