Almost all corporate companies are concerned about their employees’ welfare. Their goal is to improve their employees' well-being, which in turn results in better performance at work. They are given a number of exciting benefits such as employee discounts and bonuses, trips abroad, free food on campus, etc. A major benefit of employment is corporate health insurance.
A corporate plan might seem like a simple way to get health insurance because it involves less documentation and no medical tests. Hence, you may believe corporate health insurance will be enough to cover medical expenses for you and your family. But, such a plan will not provide adequate protection on its own.
Let’s find out why!
What Is Corporate Health Insurance?
Corporate health insurance policies are typically group health insurance policies that the employer provides to its employees The coverage is sometimes extended to family members of employees as well. In this policy, the master policyholder i.e. the employer pays the premiums to the insurance company and offers coverage to all policy members i.e. the employees.
Is Corporate Health Insurance Enough To Cover Your Family?
These are some reasons why corporate health insurance isn't enough to cover your family -
- Limited Coverage/Standardised Sum Insured:
Employees and their families are covered by a standardised sum insured under the employer's health insurance policy. In order to minimise costs and immediate risks, employers tend to keep their insurance coverage at the bare minimum. However, your family's needs differ from those of others. Hence, the coverage may seem low or insufficient to protect your family. There might also be limits on room rent/category eligibility, and copays under employer policies. So, the cover amount may not be enough to meet the expenditure you incur on treatments - resulting in more out-of-pocket expenses.
The sum insured you require will be determined based on various factors like age, life stage, family structure, lifestyle, medical history, etc. This is why your employer's health insurance policy may not offer adequate coverage for your family.
Example: Maneesh has corporate health insurance with a sum insured of Rs. 5 lakhs. His spouse and mother are also covered by the policy. One day, his mother develops stomach pain and undergoes medical tests at the hospital. Tests show that she has a hernia, and will need immediate surgery. Maneesh's corporate health insurance covers medical expenditures up to Rs. 5 lakhs, but his mother’s total treatment comes to around Rs. 8 lakhs. As a result, he must pay the remaining 3 lakhs out of his own pocket. He could have avoided this situation if he had taken adequate personal health insurance coverage for his mother.
- Not Personalised To Your Family's Long-Term Medical Needs:
It is extremely important to tailor a health insurance policy to meet your family’s specific requirements. Corporate policies, however, are created taking into account your organisation's budget. There may also be changes to the coverage terms, depending on the whim of your employer.
So, you'll end up with -
⟶ A downgraded policy as a cost-saving measure which will not be sufficient to cover the health care expenses of your family. It may even have lesser benefits.
⟶ A generic plan that won't offer comprehensive coverage or be customised to suit your family’s needs and medical history.
⟶ A plan in which you have no control over the terms, features, or future negotiations.
- Coverage Is Linked To Your Employment Status:
Corporate health insurance is a group plan linked to your company, not to you personally. This means the coverage ends once you aren’t employed with your organisation anymore and your family might be left without health insurance coverage. If you decide to switch jobs after a few years, you and your family members will be older, making it more difficult and expensive to obtain health insurance.
Not to mention retirement. Since corporate health insurance lapses after retirement, your family will be left unprotected during a time when they will be the most vulnerable to illnesses and medical conditions – if they don’t have a separate individual health insurance cover.
- Changes In The Terms And Conditions:
Your employer controls the continuation and terms and conditions of corporate policies. Therefore, your employer can terminate a group policy or change its terms to save money.
At a certain point in time, if your employer decides to cut down the expenses incurred towards the group health insurance and modify the terms and conditions of the health plan, you might be caught off guard. Also, if these modifications arrive at a time when you or one of your family members is undergoing medical treatment, then it could burn a hole in your pocket.
Now that you know corporate health insurance entails several drawbacks and might be a bit restrictive, it is essential that you purchase a personal health insurance plan for yourself and your family. This way, you will have full control over your coverage, can customise it according to your and your family's needs, and ensure adequate protection.