Group Health Insurance

Group Insurance for Individuals

Written by Nancy Sinatra

In today's unpredictable times, when nothing is certain, the only solution for all your worries about the future lies in a good insurance plan. Taking care of all aspects of your well being, be it health or finance or securing your children's future, everything can be easily tackled, when you enroll in insurance plans. As the name suggests, group insurance for individuals covers a group of people, who are usually members of societies, employees of a same company or can be professionals in a common group. While it is considered as one of the measures, which companies take to retain their employees, a group insurance costs much lesser than individual insurance plans, as it adds enough names to the insurance company's database. The operational costs of the insurance company in cases of group insurance, is also lower than what it usually takes in an individual insurance. One of the common features in a group insurance plan is that the premium cost on an individual basis may not be risk-based; instead it costs everyone the same amount for all in the group. Being a part of a group health insurance , you not only give lower premiums as compared to what you would have given in an individual insurance plan, but also avail benefits like you don't have to undergo the complex procedure of tests to show evidence of your suitability for the insurance plan. An employer usually decides the coverage area of the group insurance plan, which may include:     Life Insurance     Disability Income     Medical and Dental Expenses     Legal Expenses     Property and Liability Insurance There is a difference between the group insurance plans that are funded with traditional insurance contracts and those with alternative funding methods, like self-funding. In a group insurance, all the members are dealt with collectively, like a single insurance plan for the insurance company. Although the members are not the actual party, but one of the benefits of group insurance plan is that they can still legally enforce their rights. The certificates that are provided to the group members are not a part of the master contract, which happens between the employer and the insurance company. One of the differences between an individual insurance and group insurance plan is that the coverage of the individual starts and terminates according to the insurance contract, but in a group insurance plan, the members may become eligible for coverage long after the inception of the contract and can also leave before the termination of the group insurance contract. Many group insurance plans have probationary periods, to consider employees eligible for the coverage. There are some fundamental principals, which are taken into account while considering group insurance for individuals, like: Employees must be active at work: If an employee goes for a disability leave, then the coverage is usually not effective until the employee returns to work. Non-discriminatory insurance schedule: It means that the employees or members do not have the right to choose type or size for individual coverage. The employer and the insurance company decide the terms of the master contract. Employee contributions and deductions: The employee contributions and deductions are taken from their paychecks and then combined to calculate the total share. Equal distribution of risk: It means that the risk involved in a group insurance plan should be divided among all the employees. A minimum number of enrollments are required to carry out the plan efficiently. No clause for suicide cases: It just means that a group insurance plan does not include the clause of suicide cases. Other factors like accidents or medical health problems can be considered, but not suicide cases. While all these factors are considered by the employer, while enrolling members in a group, but it is equally necessary from the employees' part that they check all the details of the contract, like the group insurance quotes provided by the insurance company and many other factors, before applying for the membership. The low rates of premium given by the employees are tax deductible and another distinctive feature of a group plan insurance is that, on termination of employment, the group life plan remains in force for 30 days without charge. The absence of features like the efforts that go into proving your suitability for an individual insurance plan, makes a group insurance plan a better option for many people. With all such benefits, being a member in a group insurance plan does have its own advantages and disadvantages. From the employer's side, it seems to be an efficient method to make the employees happier and also to retain them for a longer period of time.

 

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