By covering medical expenses for employees and their dependents, companies not only reduce employee financial stress but also demonstrate their commitment to employee welfare.
In today’s competitive job market, offering more than just a paycheck has become essential for businesses to attract and retain top talent. One of the most valued perks by employees is corporate health insurance. This benefit goes a long way in promoting employee satisfaction, financial well-being, and a healthier workforce overall.
Corporate health insurance has emerged as a crucial employee benefit in India, with more employers recognising the role it plays in building a productive workplace. By covering medical expenses for employees and their dependents, companies not only reduce employee financial stress but also demonstrate their commitment to employee welfare.
Corporate health insurance is a group health policy provided by employers to their employees. It often extends to the employees' family members as well, depending on the terms of the plan. It is a cost-effective way for companies to ensure their workforce has access to quality healthcare from the very first day of employment. Since this type of insurance is designed for a group, the premiums are lower than those for individual policies and offer standardised benefits across all covered members.
In India, this form of health insurance has gained immense popularity due to its affordability and the immediate benefits it offers. Employers see it as a cost-effective solution that not only protects their employees’ health but also reduces absenteeism and increases job loyalty.
Key Features:
One of the primary benefits of corporate health insurance is that employees typically do not have to pay for the policy themselves. In a non-contributory plan, the entire premium is paid by the employer, saving the employee the cost of purchasing an individual health insurance policy. Even in contributory plans, the amount paid by the employee is significantly lower than in individual plans in the market.
This means significant savings for the employee, especially in cases where family coverage is included. The money saved on premiums can be directed towards other essential expenses or savings, thereby improving overall financial security.
Many corporate health insurance plans allow employees to include their immediate family members, such as spouses, children, and even parents. This is a major benefit, especially for those who are the sole earners in their families. Some policies even include maternity benefits and newborn care up to 90 days, which are generally not included or require waiting periods in personal policies.
Family coverage helps ensure that employees don’t have to worry about arranging separate health insurance for each family member. It brings peace of mind knowing that medical emergencies involving loved ones are also covered under the same policy.
Corporate policies are known for their simplified claims process. Since the company liaises with the insurance provider, the employee doesn’t need to handle most of the paperwork. Claims are often cashless, especially at network hospitals, and the turnaround time is typically faster than in individual plans.
The involvement of the employer often leads to better coordination, faster resolution of disputes, and fewer documentation hassles. Employees are spared the burden of navigating complex insurance terms and paperwork during stressful times.
Most corporate health insurance plans come with a fixed coverage amount, typically ranging from ₹2 and ₹ five lakhs. While this may be sufficient for basic treatments, it may fall short in the case of critical illnesses or major surgeries. In such cases, the employee may end up paying large portions of the medical bill out of pocket.
Given the rising cost of healthcare in India, especially in private hospitals, this limited coverage can be a significant drawback. A single hospitalisation or surgery can exhaust the entire sum insured, leaving the employee financially exposed for the rest of the policy year.
One of the biggest downsides of corporate plans is that they are tied to employment. If you leave the job, are laid off, or retire, your policy becomes void. Since there is no portability, you cannot carry forward the benefits or convert them into a personal plan. This leaves a coverage gap during job transitions unless you buy health insurance independently.
This means employees may suddenly find themselves without health coverage during critical periods, such as unemployment or retirement. Older employees may especially find it difficult to get a new personal policy due to age or pre-existing health conditions.
While corporate health insurance is a valuable benefit, it is important not to rely solely on it. The coverage is job-dependent, and the policy may end unexpectedly due to resignation, layoff, or changes in company policy. Also, the coverage amount may not be sufficient for major health emergencies.
Experts recommend purchasing a personal health insurance or a family floater plan for complete financial protection. This ensures continued coverage even during job changes or retirement and provides more control and flexibility over the policy terms.
Supplementing corporate coverage with a personal policy also helps build a no-claim bonus, enjoy lifetime renewability, and customise the sum insured based on your specific health needs. This dual approach—corporate plus personal health insurance—offers the best of both worlds. If you are unsure how to get started, consult a licensed advisor or use comparison platforms to find the best health insurance that meets your needs.
Corporate health insurance in India is a powerful employee benefit with multiple advantages. However, being aware of its limitations and supplementing it with personal coverage ensures a more robust and uninterrupted financial safety net for your health and well-being.
