For Human Resources, the biggest challenge today is to decide whether medical benefits should be offered to employees or not, what type of plans should be offered, what will be the cost and how will the cost be split between employees and employer.
Well, most of these are subjective and would depend on a lot of factors including company size, average employee salary, etc. However, this article will give you a fair idea on how you should go about deciding these factors:
1. Why offer group health insurance benefit to employees: Studies have proved that retention rates among employers offering GHI are much higher than the ones who are not offering. Moreover, the cost of providing this benefit as a percentage of salary is very low as compared to the perceived value. As an example, say if average salary of an employee in your organization is 4 LPA. If you decide to offer a health insurance benefit to him for a Sum insured of say Rs. 2 L, the cost of such a policy is likely to be close to Rs. 2000/- which is 0.5% of the cost. However, the perceived benefit of such a policy is much higher in the eyes of an employee. Moreover, most big companies offer such benefits and is therefore a selling point to the employees. It basically creates a good impression in front of your employees.
2. Types of plans: Most companies offer sum insured in the range of 2 Lacs to 5 Lacs. Almost all companies offer different SI for different level of employees. Usually the employee pool is divided into 3-4 categories and each pool is offered a SI ranging from 2 L to 5 Lacs based on salary/ designation of the employee. Most GHI plans cover Pre-existing diseases cover and do not cover OPD costs.
In terms of coverage, most organizations cover their employees only and provide an option to cover their family (Spouse, children and parents). However, the costs in such cases is borne by the employee. The benefit to the employee is that the cost of GHI is much lower than if he were to buy a seperate policy from the market and also medical check-ups are not required.
3. The cost usually for a young pool of employee ranges from INR 2000 – INR 3000 per head for a Sum Insured of 2 Lacs. However, this depends on the demography of the employees and also the coverage and features of the policy.
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