Differences Between Group and Individual Health Insurance

  • postauthorOnsurity Editorial
  • postdateFebruary 21, 2024
  • postreadtime3 min read
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Group Health Insurance vs Individual Health Insurance

Providing a host of employee benefits is an effective way to attract and retain a talented pool of employees. The employees are a real asset of an organization and hence, as an employer or an HR manager, building a strong employee benefits package can be your best investment.

When you are on the lookout to buy employee health insurance, you might come across two types of insurance i.e., health insurance and group health insurance. While the two types of policies do help one get the required financial protection in times of a medical emergency, the nature of both policies is different to a large extent.

What Is Group Health Insurance Policy?

  • A group health insurance policy is an employee-sponsored health insurance coverage which is offered to employees at no or small fee
  • Coverage can be extended to employees and their family members
  • This type of policy can be helpful for employees who do not have individual health coverage

What Is an Individual Health Insurance Policy?

As the name suggests, an individual health insurance policy provides cover to a single member only

The covered individual must pay a premium for the policy purchase, which is decided based on his age, medical condition, profession, etc.

Also, Read: Difference Between Life Insurance and Health Insurance

Difference Between Group and Individual Health Insurance

Feature Group Health Insurance Individual Health Insurance
Meaning This is a type of health insurance for a company, covering the employees employed in the organization. Offers coverage to the policyholder
Who is insured? Employee and their dependents Policyholder
Who purchases it? Purchased by the employer for employees Policyholder
Option to buy add-ons None Policyholders can choose to enhance coverage by purchasing add Ons at an additional cost
Claims Settled through in-house team at employers’ end or through third-party administrator Settled through a third party or with the insurance company
Eligibility Offered to permanent employees Individuals should be aged 18 years and above
Tax benefit Offered to employers Yes

Is Group Health Insurance Cheaper Than Individual Health Insurance?

To put it simply, the cost of group health insurance is lower than that of health insurance. The premium for group health insurance is paid by the employer and the employees must pay little or no premium at all to get the coverage. Additionally, a few group health insurance plans also extend coverage to family members of the employees.

With individual health insurance, individuals must pay the premium out of their pocket. Choosing group health insurance is a viable choice as it is sponsored by the employer, offers maternity coverage, and covers pre-existing diseases too, without any health checkup.

What to Choose Between Group and Individual Health Insurance?

Health insurance has now become a necessity, therefore, it is important that you first ensure that you have either group health cover or individual health cover. If you are an HR manager, corporate company, SME, or startup, it is important that you provide comprehensive health benefits to your employees.

At Onsurity, we offer comprehensive health membership plans that include insurance benefits for employees and a host of other wellness benefits like diagnostics, discounted doctor consultations and more.

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