Why do small businesses need group health insurance?

Estimated read time 4 min read

The MSME sector has long been the backbone of the Indian economy, providing employment opportunities to crores of Indians and driving a significant portion of the GDP. Not only this, small companies are also some of the most profitable businesses in the country due to their small scale and lower investment costs.

Due to this, every year, millions of new entrants join small businesses. Most of these individuals are from the middle class, i.e., not a part of any government schemes, and need more disposable income to invest in comprehensive policy. To ensure their financial security and well-being, the government mandated all professional organisations to provide health insurance to their employees. 

But what is group insurance, why should small businesses get group health insurance, and what are its benefits? Keep reading to find out.

What is group health insurance?

Group health insurance is a specially designed policy to provide a unified health insurance policy for all group members. Under group insurance, companies can provide health insurance to all employees regardless of age, gender, socio-economic status, and prior medical conditions. Not only are these policies beneficial in terms of convenience, but they are also more cost-effective than providing individual policies to each member and highly customisable based on the group’s needs. 

Why should businesses get small group health insurance?

Whether it is due to the government mandate or Just a few years ago, as India was about to enter the COVID-19 pandemic, the Government of India, realising COVID-19’s potential impact, mandated all professional organisations to provide health insurance to all employees.

Following this directive, companies have decided to consider group health insurance for their needs. This is because these policies allow groups to evaluate the needs of all members and provide adequate coverage for everyone.

What are the benefits of small group health insurance?

Under group policies, insurers offer numerous benefits to both the employees and the organisation. The following are some of the benefits provided to employees. 

  • Coverage for all members in a single policy

Group policies cover all group members in a single policy regardless of any differentiating factors. This, along with features like pre-existing disease coverage and no pre-policy check-up, provides coverage for risks without hassle. 

  • Ensures financial security for employees 

In today’s complex landscape of growing healthcare costs and rising health risks, health insurance ensures financial security, reducing the extent of out-of-pocket expenses for employees significantly. 

  • Additional coverage options 

Group policies also provide additional coverage options that might otherwise be unavailable for individual and family policyholders.

  • High customisability

These highly customisable policies allow groups to build the right policy based on their needs. 

Benefits of group health insurance for small companies

The following are some of the benefits of opting for group plans for small companies:

  • Boosts morale and productivity

Providing group policies to your employees boosts morale and builds a safe and productive working environment. With the right policy, employees can be protected from risks, thus enabling them to focus on their tasks.

  • Cost-effectiveness

Group plans are significantly more cost-effective when compared to purchasing individual policies for each member. 

  • Tax benefits for the employer

The premiums paid under group plans are tax deducible, thus providing tax benefits to the organisation. 

  • Better talent attraction and retention

In today’s competitive work environment, offering health insurance has become mandatory for qualified talent to join a particular organisation. By providing group policies, it is possible to attract and retain talent. 

Conclusion

In conclusion, group health insurance is a valuable tool that allows businesses to provide all employees with health insurance. Not only are these policies highly customizable, affordable, and convenient, but they also benefit both the employees and the organisation. So choose the right policy today and secure your valuable employees’ financial security and medical well-being.

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