What employers should consider while buying group health insurance policy for employees

Strong Employer-Employee Relationship is very important for an organisation to do well. It is no rocket science that employees having mutually respectful relationship with their employers are more likely to be happy, loyal and productive in the long-run. To maintain a positive relationship with employees, the employer should take measures to protect them. Offering health benefits is one such way. Hemant Rustagi, CEO, Wiseinvest Advisors explains that health insurance is important as lifestyle diseases are becoming quite common. He said this is where a responsible employer can make a difference by buying a group health insurance policy that not only covers the employee but also other dependent family members. This can be a great morale booster for the employees and also instill a sense of belonging in them.

What to consider in policy?

"Medical inflation has been rising at an alarming rate. In fact, one visit to the hospital is enough to disrupt the budget of a middle-class family. Hence, while deciding the coverage for the employees, the employers must endeavor to provide adequate health insurance cover to help them deal with medical expenses in case of hospitalization. Ideally, the minimum cover should be Rs.5 lakhs under a group health insurance plan," Rustagi said. 

He added that one should also take care of the premium which is an important factor in choosing a group insurance plan, too much emphasis on it can make the employees compromise on some of the important features and the quality of service. Apart from this, the employers also need to check the network of hospitals where employees can seek cashless treatment. "An insurance company with a wider network of reputed hospitals should be preferred," Rustagi said.

How to choose the right plan?

Col Sanjeev Govila (retd), CEO, Hum Fauji Initiatives told Zee Business Online that healthier – and insured – employees are less likely to be burdened by financial stress. Those positive effects, in turn, are likely to boost attendance, productivity, and profits, especially for small businesses. Here are a few points that should be considered by purchasing group health insurance policy -

1. The cost of providing insurance - Affordability is the key when it comes to group health insurances. The companies need to be realistic with the cost. Govila said, "The cost increases are on account of an increased number of employees as also the increase in premiums over time. Of course, the unpalatable option of requiring the employees to pay an increasing part of the premium themselves also exists."

2. Check up on your competition - Companies should check if similarly sized employers in their industry offer such coverage or not. It is important match them to remain competitive.

3. Get feedback from your employees - Govila suggests that organisations should survey their employees to determine their level of satisfaction with package offered. "Seeking feedback from your employees is a good place to start, and can give you an idea of their willingness to join an employer-sponsored plan, the type of coverage they’d like to see, and the amount they’d be willing to pay for it," he said.

4. Choose right firm - The companies need to keep in mind that the insurance firm should be active in their area and more importantly in the area where the majority of your employees stay. They also need to survey the hospitals which accept that health insurance firm’s policies.

5. Understand what is on offer - " If you’re planning to offer plans for the dependents and parents too, their age and health profile should also be generally known so that the plan details can be worked out and negotiated," Govila said. Health insurances have a large number of options, exclusions, co-pays, room and extras options. "This will have to be carefully worked out by preferably setting out initially how much are you willing to pay and what do the employees require," he added.