Unlike the US, in India, it is not legally binding for employers to provide health insurance to their employees. However, in recent time a number of large to mid-sized enterprises are offering group insurance plan to their employees in an attempt to promote employee friendly work culture. While this is a great move to bring more and more people under the fold of health insurance, one need to question if corporate health insurance is enough to address individual health needs? Or do you need to buy a standalone health plan? To find answer to these questions which is so relevant in today’s context is the basic premise of this write-up.
Before, we address this question; it is relevant to understand, why we need health insurance in the first place. The rising cost of health coupled with increase instance of lifestyle diseases is two of the biggest reasons why health insurance is mandatory today. Despite this, people often delay to sign up for a dedicated health insurance plan or entirely rely on their employer for it. Securenow, India’s leading insurance brokerage firm opines that this is not a very favourable trend as postponement in taking up a health plan will increase the cost of premium (the older you are, higher the premium). At the same time, it is always better to be prepared for a medical emergency, as out of pocket expense to meet medical cost can be financially draining.
Consequently, relying only on your corporate insurance plan is not a very viable option either. Experts have pointed out that since the economic slowdown of 2008 several Indian companies have slashed down insurance premiums and are introducing restrictions on covers. Employee health schemes are thereforenot enough in case of critical illness or hospitalization exceeding more than a week.
What is included under Corporate Health Insurance?
As the name implies, corporate health insurance cover all employers of an organization under an umbrella plan. Typically the key inclusions of such plans are:
· Maternity cover at nominal rates
· Cover from pre-existing conditions only up to a certain limit.
Additionally, employers may also give the employees the option to expand their health plan with voluntary deductibles.
Why corporate health plans are not always a full-proof health plan?
As per a study nearly 95% of the population in India does not have a sound medical cover for the most common procedures and ailments. At the same time, those who have full time jobs do not feel the necessity to supplement group insurance plans with individual plans. However, corporate health insurance is not a full proof plan for the following reasons:
· Corporate health plans become redundant for individuals who are in-between jobs or those who are planning to set up their own business, which is a formidable career choice these days.
· Inclusion of dependents such as spouse, children and parents in your corporate plans largely rests on the discretion of the employer.
· In face of the rising medical and treatment cost, corporate health plans may not be adequate to meet the hospital or consultations bills.
· Certain clauses such as co-payment and deductibles under corporate insurance health plans mean that the employees will have to bear the costs for certain procedures and expenses out of their own pockets.
· Corporate health plan ceases to apply on retired individuals. Unless you have taken an individual health plan before the age of retirement, you are likely to have no health cover which is non-negotiable need for the ageing population.
· Changes in the company policy with respect to the corporate plan can also impact the coverage. It is up to the discretion of the company to introduce changes in the existing planor withdraw the plan completely or partially.
Why should you buy an Individual Health Plan?
Individual health plan is applicable to the policy holder, at the same time certain sum of cover is extended to the members of the family as well. Anyone can procure an individual health plan that helps you deal with hefty medical expenses at the same time can help you save tax under the section 80D of the Income Tax Act. Individual health plans offer covers for the following aspects of treatment-
· Routine medical examination
· Emergency room services
· Diagnostic and laboratory services
· Maternity and post-natal care
· Consultation fee
· Room and boarding expenses
Besides these, some individual health plans also provide cover for alternative medicines such as Ayurveda, Uniani or Naturopathy etc. The cap amount for such treatment usually ranges from 7.5% to 12% on the assured sum.
In conclusion –
While there are definite advantages of corporate health insurance plans such as low premium rates, no waiting period or underwriting, coverage from pre-existing condition, such plans have certain limitations. For adequate health needs for you and your family, it is strongly recommended that individuals take up a standalone health plan. Although, the premium rate varies and is determined by the health condition of the person, the benefits are numerous. Therefore, it is extremely relevant to look beyond your corporate health insurance plan.