Supplement employer health plan with a personal cover

 Supplement employer health plan with a personal cover

Employer-sponsored health insurance is a critical element of the benefits package provided to employees. When the coverage is comprehensive and the sum insured is sufficient, it provides protection, and hence peace of mind, to the employee and his family. A recent study by Plum, a health insurance platform, which examined the health insurance policies offered by over 2,500 employers, revealed several gaps in the converge they provide.

No check-up, no waiting period :

Employer-sponsored health insurance offers multiple advantages to employee. 

One, the burden of paying premiums is on the organization. “The employer often covers the premiums for the employee, the spouse, the children, which is a valuable benefit for employee.

Two people who have pre-existing diseases are often denied access to a retail health insurance,”In an employer-sponsored group plan, there is no health checkup, medical underwriting, or requirement to disclose pre-existing conditions. Therefore, employee gets insured regardless of their health condition.

Three,employee-sponsored plans provide day one coverage for pre-existing diseases (PEDs).”Individual plans typically have a waiting a period for PEDs before coverage begins. This waiting period can range from two years to four years in these policies.  

Four, in many cases, employer-sponsored plans also cover parents. Since elderly parents tend to have several pre-existing conditions, they find it difficult to buy a retail health insurance cover. Their child’s employer provided cover is the only health insurance they have.

Five, employer-sponsored plans often include maternity benefits, which may not be covered by personal health insurance plans.

Benefits can be reduced 

Employer –sponsored health plans have shortcoming that employees need to be aware of. These policies are typically renewed annually. Whether or not the employer renews the policy is not generated.

The premium of the policy changes based on the company’s claim history.”If there are high claims, the insures may increase the premium, leading the company to cut back on benefits or not renew the policy altogether

These factors can create uncertainty for employees (especially of younger, smaller companies) dependent on their employer –sponsored policy for coverage.

Many companies only cover the employee. According to the plum study, 30 percent of organization doesn’t extend benefits to their employee’s families. And 75 percent don’t extend benefits to their employees parents. “It is critical that organization offer insurance benefits to parents, even if the employees themselves have to bear a part of the cost burden.

Sum insured may be inadequate

According to the plum study, the median sum insured offered by employer is 3 lakh. This amount would prove grossly inadequate if a person falls prey to a critical illness.

The Plum study also found that only 56 Percent of employers offer maternity benefits. Today, a normal delivery can cost Rs.60,000/- to 80,000/-. A Caesarean-section can cost a lakh or more. “These costs can impose a substantial burden on younger couples in the early part of their careers.

According to experts, offering this benefit would aid in attracting and retaining younger, especially women, employee. Many employers, however, avoid giving this benefits because of the cost involved.

“Insurance companies typically increase the premium by around 20% for providing the maternity  benefit, 

Buy a personal cover

All employees should supplement the employer-sponsored health cover with a personal cover. “Employees-sponsored health cover with a personal cover. “Employees may lose their jobs, as was witnessed during the pandemic and more recently, amid the crisis in the US technology sector.

Employee may also change their jobs, and the company they move to may not offer health insurance, or may offer one with curtailed benefits. Those who decide to become entrepreneurs would also lose access to an employer-sponsored cover.

Remember that buying a personal cover becomes more difficult after the mid-40s.

PERFECT FIT: HOW MUCH PERSONAL INSURANCE COVER SHOULD YOU BUY?

The amount of sum insured you buy should be dictated by the type of hospital you are likely to go to for treatment, the room type you prefer, and your city of residence.

For a family of three, you should buy a floater policy with a sum insured of RS 10-15 Lakh if you live in a smaller city, and Rs 20 lakh or above in case of a metro

This should be supplemented with a super- top-up cover of Rs 50 Lakh to take care of critical aliments.

Senior citizens should, in addition, also have a health corpus to meet ancillary costs

For More Details: Pooja Manoj Gupta, visit www.giia26.com
Email: pmgiia26.com Mobile 9868944340