There is a wave of several lifestyle diseases amongst people worldwide, and with the rising medical costs, it is all the more important to have medical health insurance. Medical health insurance helps an individual to remain emotionally and financially secure in times of an emergency. It protects you against the unforeseen and helps to combat the challenges of the situation. Opting for medical health insurance and choosing the apt health cover for an individual is equally important. Before delving into the differences between group medical and individual health insurance, let us understand what they mean. 💭

Group Medical Plan

A group of medical insurance is provided to the organisation’s employees by the employer. It acts as an incentive for the employees as it is covered as a part of their compensation. A group health insurance allows the employees to work stress-free at their job as it takes care of the medical expenses in times of need. The employer groups a number of their employees together, assesses their medical requirements and condition and accordingly plans for coverage for the group. Hence, once the assessment is complete, the premium and coverage of the group insurance are concluded based on the cumulative risk of the group’s employees. The coverage provided is uniform to all the members of the group medical insurance. ✔

Individual Health Insurance Plan

The health cover an individual buys for themselves is termed an individual health insurance plan. The individual assesses factors like age, medical history, diseases if any, and family medical history before opting for a policy. The premium cost, however, varies based on the type of policy coverage chosen. 💯

Group Medical Insurance vs Individual Health Insurance

Let us dive deeper into a few key basic differences between the two:

1. Policy duration: ⏰

Ø Group medical insurance plan: The coverage is controlled totally by the provider and can be cancelled if the member is no longer a part of the group.

Ø Individual health plan: It is a decision on the personal capacity of the insured, whether to continue with the plan or not.

2. Coverage

Ø Group medical insurance plan: Uniform coverage is offered to all the individuals of the group. It is a one-size-fits-all type of concept.

Ø Individual Health Plan: The policy coverage can be customised by the policyholder.

Pros and Cons 📃

Group Medical Health Insurance

Pros

• Group insurance plans are available at a comparatively much lesser cost than individual health plans.
• The employer bears the cost of the group insurance, and the employees covered under the policy do not have to shell out money from their own pockets.
• Since the organisations opt for bulk group plans, the per-person cost comes to an affordable level.
• Group plans offer a huge advantage in terms of tax payments to the employers as well as the employees.
• One of the biggest incentives of the group plans is the inclusivity of the pre-existing conditions.
• The employees can relax and benefit from treatment of their pre-existing diseases with ease under this plan. Hence, it acts as a huge cost-saver for both parties.

Cons

• The option to customise varies from organisation to organisation.
• The employee is covered under the policy only until they are associated with the company.

Individual Health Insurance

Pros

• For individuals with dependents in their families, an individual health plan is a go-to choice.
• On the other hand, it is important to note that some of the plans may have certain permanent exclusions, making it difficult to lock in a plan.
• This type of insurance boasts a no-claim bonus, which gives it an edge over group insurance.
• It means that the policyholders will be eligible to avail discounts or even opt for an option of increasing the sum insured under the current plan at the time of policy renewal.
• While group insurance plans are active as long as you are associated with the organisation, the individual health plan will continue to be active for as long as the policyholder wants and does not get terminated on its own.

Cons

• Premium cost – This is one factor that significantly differentiates these two plans.
• The premium cost is entirely borne by the policyholder in the case of individual health insurance. Hence, this turns out to be a bit expensive.

Some of the other distinguishing factors are as follows: 🔍

Post Retirement scenarios – If one is solely secured under a group insurance cover, then post-retirement, it would be not easy to opt for an individual plan as several plans have entry limits (age-wise). One may want to derive maximum benefits at that age where it is more beneficial. The chances of getting a decent insurance cover at that stage with an affordable premium having desired benefits covered are faint. More so, the affordability factor plays a major role at a later stage where one has been covered just with group insurance their whole life before switching to an individual plan.

Applicability – Only when employed with a particular employer does the insurance last. It also depends on the company size and its policies while switching jobs. It is not predefined that an employer must provide for its employees under health insurance. Also, the extent of coverage may change – it may be more or even less depending on the policy, the sum invested and team size.

Hence, we can understand that no one plan fits all approaches. Group Medical Insurance and individual plans are currently available at an attractive interest rate. One can identify their requirements first and analyse which type of insurance plan suits them the best. It is crucial to research well and opt for the plan that offers comprehensive coverage at an affordable sum assured cost. 👍🏻