Group Health Insurance vs Individual Health Insurance | RenewBuy

Group Health Insurance vs Individual Health Insurance

What is the Difference between a Group Health Insurance Plan and a Regular one?

Health insurance is one of the crucial types of insurance coverage that is necessary to have. Having an adequate amount of health insurance coverage can safeguard you and your family financially at the time of sudden medical emergency. With the increasing number of lifestyle diseases and rising cost of healthcare inflation, health insurance coverage is no longer an option, but a necessity for everyone. When it comes to buying health insurance coverage, there are many types and various ways to get covered. Knowing the difference between each type can help you make this rational long-term investment decision to protect your health.

Specifically, if you are a salaried employee, it’s quite common to weigh between group health insurance plans and individual or regular health insurance plans while buying health insurance coverage. Let’s take a look at what is the difference between a group health insurance plan and a regular one in detail.

What is Regular Health Insurance Plan?

Regular health insurance plans are the stand alone plans that an individual can purchase himself from any health insurance company to cover himself and his family against future medical contingencies. There are various types of plans available in the market such as individual plans, family floater plans and senior citizen plans etc. With the variety of options available, you can choose the best suitable plan all by yourself or with the help of insurance agent and customise the plan as per your requirement and affordability.

What is Group Health Insurance Plan?

Group health insurance plans are the health insurance plans purchased by the organization or employer for their eligible employees. The whole idea is to provide health insurance coverage for set of people belonging to the same group. Cost of these plans are generally shared between employer and employees. In some cases, entire cost is borne by the employer.

Difference Between a Group Health Insurance Plan and a Regular one

Each type of health insurance plan has its own advantages and disadvantages. Hence, while weighing these plans various parameters are to be considered. To understand the difference between a group health insurance plan and a regular one, let’s compare them on the basis of certain parameters mentioned below.

  • Cost: Employer-sponsored or group health insurance plans are undoubtedly provide health insurance coverage at reduced cost. There are two main reasons for this. First one is the economics of scale benefit enjoyed by the insurance company to cover large number of people under one policy. Secondly, the cost of the policy is borne by the employer in most cases and in some cases, it is shared between the employer and the employee, which is a win-win situation for the employees. On the other hand, regular health insurance plans are relatively expensive as they provide various additional features, riders and coverage as per the individual requirement. However, plans can be chosen as per the affordability and need as there are plenty of options available.
  • Customisation: Group health insurance plans are the comprehensive benefit packages that is designed for a particular group with a limited coverage to each member along with limited features. Hence, group health insurance plans cannot be customised as per your individual healthcare needs. On the other hand, regular health insurance plans offer your range of benefits and additional riders to choose from depending on your coverage need and as well as affordability. Customisation is a key benefit available with regular health insurance plans.
  • Waiting period: Group health insurance plans cover many pre-existing health conditions without any waiting period. Health insurance benefits can be availed in the initial days of your employer-sponsored or group health insurance policy as the condition of waiting period is usually waived off, as per the employer requirement. However, regular health insurance policies come with waiting period ranging from 2 years to 4 years to avail the insurance benefits in case of pre-existing illnesses.
  • Medical check-up: Most of the group health insurance plans do not require detailed medical examinations as the coverage is based on the details pertaining to the entire group of employees or members covered under the plan. However, individual health insurance plans require you to undergo detailed medical examination to get the desired amount of coverage.
  • Coverage extension: In group health insurance plans, health insurance coverage is provided as long as you are associated with the employer. There is no option to continue the coverage post-employment even by the employer as well as the insurance company. On the other hand, most of the regular health insurance plans come with lifelong coverage these days.

Conclusion

To sum up, every health insurance plan has its own pros and cons. Group health insurance plan falls short in customising your needs and coverage. Regular plans can be comparatively costlier. In spite of differences, key point is to have the adequate health insurance coverage. So now, you know about the difference between a group health insurance plan and a regular one. If the limited coverage offered by group insurance plans are not sufficient, it’s wise to have standalone plan to stay adequately protected.

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