Trends in group health insurance plans offered by large service firms

Taking cues from the developed nations, many organisations in India are embracing positive trends and working towards offering a competitive and effective health benefit package to retain and hire talent. In this chain, many companies have expanded their group health insurance scheme. Even, health insurance companies have added a few feathers in their group health policies. Have a quick look at some of the trends in group health insurance schemes:

1. Expansion in health insurance coverage: For the first time in the last few years, the average health insurance coverage offered by companies has raised from Rs 3 lakhs to Rs 3.5 lakhs. In addition to this, room rental cover has also increased from Rs 3,000 to Rs 4,000 per day.

2. Coverage for parents: Until now, insurance companies have raised premium rates due to high claims in health insurance policies. Also, employers had been acting on higher premium rates by putting a cap on covering parents or placing other restrictions. However, companies have now realised that employees are interested in paying out money from their pocket for covering their parents or expanding their insurance coverage. Therefore, many companies have allowed their employees to include parents under group health cover on payment of extra premium.

3. Increase cover for critical ailments: Nowadays, various companies have started offering critical illness cover along with their group health insurance policy to their employees as well. These plans prove useful as they pay a lump-sum benefit on diagnosis of a critical ailment. This amount can be used to meet both household and medical expenses. Some of the ailments covered under the cover are brain diseases, heart attack, kidney ailment, etc.

4. Health insurance portability: Given the rising health awareness among people, many insurance companies allow employees to convert their group health insurance cover into individual policies after retirement. The waiting period is also adjusted accordingly. For instance, if you have been covered under a group health insurance cover for say, three years and then decide to port your policy to an individual policy, having a waiting period of say, four years for pre-existing diseases, the new health insurance policy will waive off one year of the waiting period.

5. More loan-linked health insurance policies: In the next few years, loan-linked health insurance plans will become popular. A loan-linked health insurance plan will repay the outstanding amount when you fall ill and unable to repay the loan instalments. Offering under the group platform, the tenure of these plans has been increased to a maximum of five years. Earlier health insurance regulations did not allow group policies of over one year.

6. Premiums likely to rise: Soon, the premium of a group health insurance cover may rise shortly as the insurance regulator; IRDAI is ready to crack the whip on disclosures to curtail the subsidization of individual insurance policies. As a result, group health insurance premiums may increase, which in turns, means companies would be shelling out extra in providing group health cover to its employees.

7. Pilot projects for innovative health insurance products: Health insurers can now test health insurance products with their pilot projects. It means, insurance companies can launch closed-end-health products that come with tenure of up to 5 years. After five years of launch, the insurer can either withdraw the product or get it converted into a regular health policy. However, in case of withdrawing the project, the policyholder will be given an option to migrate to some other health policy.

Indeed, the new health insurance trends have kicked off some exciting opportunities for the insurance segment in terms of launching innovative health insurance projects. However, only time will tell the impact of these trends. Let’s keep our fingers crossed!