After the COVID-19 pandemic, lives all over the world drastically changed. It was in March 2020 that India went into its first lockdown. And fundamental things like the way people shop, work, learn, move, and interact underwent a transformation.
People had to reflect and re-evaluate old habits and perceptions. The journey ahead was unclear. But, after almost a year, one of the most immediate and apparent lessons is the value of health. These circumstances made medical insurance for employees mandatory in India.
Is Medical Insurance Mandatory For Employees In India?
Yes, it is mandatory for companies to provide health insurance in India post the Covid-19 lockdown in 2020.
In April 2020, the Indian government made it mandatory for all employers to provide mediclaim policy for employees in India.
The world has slowly started prioritizing health after global and national health agencies continually stress the need to keep the immune system strong to get through these times. People are eating clean, exercising, drinking sufficient water, and increasing their hygiene to remain healthy and strong. Another indispensable tool in this fight is health insurance. With this in mind, the Indian government started taking initiatives to ensure the Indian population has some sort of health insurance.
Why Should Health Insurance Be Mandatory For Employees?
Most of the employees in India do not go for medical benefits due to lack of awareness. They were thinking like "Is employee insurance mandatory for our employees". However, there are many companies which offer medical benefits for employees in India.
Now lot of employers are searching online for the best group health insurance plans to protect their employees now that the government has made it mandatory for employers to provide health insurance for employees in India.
Before this reformatory decision by the government, medical insurance benefits for employees in India wasn’t mandatory for employers to provide insurance to their workforce. Although some organizations were a step ahead & already covered their employees & their respective families via group health insurance plans. Following the events of 2020, new regulations have been put in place. These regulations also focus on employees who work beyond top metro cities and in smaller firms.
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Are All Employers Required To Offer Health Insurance?
Absolutely, yes. As a part of the Consolidated Revised Guidelines for resuming workplace operations by the Ministry of Home Affairs, on 15th April 2020, the Insurance Regulatory and Development Authority of India (IRDAI) released an order (No. 40-3/2020-DM-I (A)) which states that all commercial and industrial establishments, offices, workplaces, etc. shall follow a Standard Operating Procedure (SOP).
The SOP includes social distancing for offices, workplaces, factories, and establishments, medical insurance for workers to be compulsory.
In the circular, the regulator recommends insurers to offer comprehensive health insurance policies to individuals or groups. The regulator has also encouraged insurance companies to create comprehensive health insurance products with simple wordings at an affordable cost for the organizations.
This way, organizations can comply with the directives in place. It also stated that organizations should be able to continue the medical insurance policies given by insurance companies not just for the time being, but for the rest of their lives.
Those employees who are below the wage limit of Rs.21,000 can get coverage under Employee State Insurance (ESI) and those above can seek cover under Group Medical Cover (GMC).
Finding the right balance between affordability & rewards:
As organizations get busy researching online about the best-priced plans for their employees, it is equally important to note that the additional health benefits play a crucial role in deciding the best plans for the employees. Generally, a group health insurance policy covers the hospital bills for the employees & their families (up to a certain limit of family members)
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When it comes to benefits, there are different types such as sickness, maternity, disablement. OPD is also one of the popular medical benefits for employees in India. It stands for Out-Patient-Department which covers the Physician, Clinic visits, Lab testing, or doctor’s visit to the home (virtually or physically)
The government has ordered employers to offer comprehensive health insurance plans for their employees. The plan has to be affordable with uncomplicated Terms & Conditions. The decision is expected to benefit both small & large-scale organizations.
As the HRs scan for the best group health insurance quotes out there in the market, they would require to balance factors like rewarding benefits, better coverage, customizable & economic plans.
This is indeed a very well-welcomed decision by the employees since a healthy employee is a happy employee, as well as by the employers as they get to engage with their employees & increase their organization retention rate by using health care benefits for employees as a motivation tool.
Employee medical insurance is advantageous not only to the employee but also to the employer. As a result, it is essential that you gain medical insurance for employees without delay.
As an employer, you can either take out an employee group health insurance for employees or assist your employees with buying a retail policy by tying up with an insurance company.
Why Offer Health Insurance To Employees?
Group health insurance is one of the mandatory employee benefits in India. Medical insurance for employees is critical for more than just efficient day-to-day functioning. A person who is emotionally and physically fit is more driven and optimistic. Employee health and productivity are strongly intertwined. And keeping employees happy is an important part of running a successful business.
Let's see what are the benefits of providing health insurance to employees and employees.
What Are The Benefits Of Medical Insurance For Employers?
Employers can enjoy the lot of benefits of providing health insurance to employees.
- It’s a good retention tool as employees know employers take care of their needs.
- It boosts employee morale and productivity.
- Employers offering health insurance to their employees can receive tax benefits under several sections of the Income Tax Department.
- It’s a more affordable option compared to retail health insurance.
- Group health insurance can also provide coverage to spouses, children, and family members.
- It covers pre-existing diseases and illnesses and offers maternity cover from day one which is unavailable with retail policies.
What Are The Group Health Insurance Benefits For Employees?
- Employee group health insurance has lower premiums than individual or family health insurance because the total amount is shared with other employees.
- Group health insurance plans include insurance for family members and friends.
- It offers a hassle-free claim settlement process for employees.
- Employee medical insurance policies also cover maternity benefits as well OPD (Out-Patient- Department) benefits for preventive care of the employees.
- Group health insurance allows you to file a claim for pre-existing diseases. So, there are no waiting periods for covering pre-existing conditions in group medical insurance.
Is It Right Time To Buy Group Health Insurance?
Hope you got an answer to your question "Is Medical Insurance Mandatory For Employees In India?". The Corona pandemic taught us all a valuable lesson about being proactive rather than reactive when it comes to health insurance. Because having health insurance is the greatest weapon for all humans to attack with enemies like Coronavirus.
At Loop, the process of buying group health insurance for business owners, and HRs are simplified. You can go from start to finish in just a few steps.
Your organization can pick and choose from a variety of plans to suit your needs. Every plan comes with a plethora of features such as no waiting period, cover for hospitalization expenses, comprehensive 24 x 7 support, free tele consultations with medical experts, and more.
Your employees can unlock all this once the insurance coverage kicks in. For easy access, employees can download the Loop Health app. The app offers unlimited information pertaining to the policy, claims, doctor consultations, and much more.
Healthy employees are one of your most important assets. It’s time to set your team up for success with health insurance. Your employees can focus on the end goal and as an owner, you have peace of mind.
Interested in learning more about Group Health Insurance? Click here
FAQs About Medical Insurance Mandatory For Employees In India:
1. What is the minimum number of employees required for group health insurance?
A company with 7 employees can be covered by group medical insurance. Read this blog to know more about employer group health insurance requirements
2. When did Group Health Insurance for Employees become a legal requirement in India?
The Indian government makes it necessary for all firms to provide medical insurance to their employees in April 2020.
3. What is the best time to purchase group health insurance for my employees?
When it comes to health insurance, the Corona pandemic taught us all a good lesson about being proactive rather than reactive. Because having health insurance is the most effective weapon against foes like Coronavirus. So you should buy group health insurance as early as possible.
4. What is the cost of group health insurance in India?
A variety of factors influence the cost of group health insurance. Premiums for group coverage health insurance start at Rs. 450/- at Loop. To learn more, read our group health insurance pricing guide.
