Best Health Insurance in india for Small Businesses in The Indian spirit of enterprise has been celebrated across the world. India is home to the one of the largest Small & Medium Enterprises (SMEs), with an estimated 35 million enterprises, constituting 80% of the total number of industrial enterprises.
Entrepreneurs and Key executives running SMEs compete with larger companies to attract and retain talent are under great pressure to benchmark remuneration and benefits, including Group Health Insurance Benefits. On the other hand, Health Insurance has become a necessity. With the healthcare inflation skyrocketing, it’s going to become increasingly difficult for employees to take the risk of wiping off their complete savings or worse get into debt for paying the hospital bills. Entrepreneurs can balance the financial risk by benchmarking employee benefits at the same time help encourage financial coverage and prudence. So how do you go about it? Insurance is all about pricing the probability of risk. Insurance Companies buy risk by foreseeing a smaller loss (claims) than the premium. Group policies being less restrictive, the smaller the group the higher the probability of claims, hence smaller groups have more expensive per unit premiums. For example if an Insurance Company covers a group of 10 employees for say Rs.40000 per year, and does not have any waiting period for ailments. Given the high costs of healthcare today, just one accident or hospitalization can wipe out the premium paid. If in the long term, an enterprise wants to get a good product and service – like any other vendor, it has to ensure that the Insurance Company makes money out of the product/service.
Many large companies are paying the price for ignoring at the viability of the coverage. Premiums for most of the large companies in the last couple of years have grown by close to 50%. SMEs could also fall in the same trap, and lose long term predictability of their employee benefits costs. Here are some basic level recommendations on the approach one should take when looking for a Group Health Insurance program for employees. 1.
Employee size of less than 20.
A Group plan is not recommended for such a firm or organization. A better way to handle this is to sponsor the personal policies of your employees. Create premium limits like other employee benefits and encourage the employee to buy his, own personal best health insurance in india. By giving a fixed amount, you are giving flexibility to the employee to get a policy that he needs, at the same time the liability of the enterprise is fixed. Though a 10% increase in limit is recommended, it still is a more predictable cost than a group plan. The personal policy being owned individually by the employee does not bind him with the organization. It’s more of a welfare tool, than a retention one. Though it would depend upon company to company, A Limit of Rs.5000 per employee for ground staff and Rs.8000 limit for senior employees should suffice. The organization should help identify a specialist health insurance firm which can give good advice and service (including claims assistance) to the employees. Market: Currently no group plans are available for such organizations. 2.
Employee size of 21-50
Though Group Mediclaim Plans are available for such enterprises, it is very important to understand the long term impacts and structure them well. Everyone would agree that it is very convenient to launch a new employee benefit program, but, it is very difficult to withdraw or curtail one. For organizations, where the health insurance plan was not structured well, Health Insurance costs have spiraled by more than 50% Some tips: 1.
Try to attempt, if you can convince the team about sponsoring the purchase of their personal insurance, similar to the less than 20 employees companies. It makes great sense. The point you need to sell is that they own the policy and can carry forward across
their entire lives, unlike the group policies offered by large companies, but are not portable to be renewed independently. 2. If point 1 does not work out, structure the plan very carefully. Employ restrictions and exclusions wherever necessary. For example, you shouldn’t provide a pre-existing, parent’s cover or maternity cover under such a small group else, your premiums would rocket every year by a minimum of 30%. Since group plans being tailor-made, employing an expert in this field can help you understand how the structuring can happen, and have a clear tab on your future costs. [Source: http://www.medimanage.com/health-insurance-expertsblog/post/2010/10/16/Group-Mediclaim-Health-Insurance-for-Small-Businesses-inIndia.aspx#.VvvAu9J97Dc]