Group Health Insurance vs Individual Health Policy —
What's Better for Your Team?
A clear, fact-based comparison of two healthcare approaches — so you can make the right call for your employees and your budget.
Quick verdict: For any Indian employer with 7 or more employees, group health insurance (GMC) almost always delivers more value per rupee than asking employees to buy individual policies — lower cost, no medical underwriting, and a full tax deduction under Section 37(1).
Two different healthcare approaches
Understanding the structural differences helps you choose the right model for your team.
Group Health Insurance (GMC)
A single policy purchased by the employer covers all employees — and their families — under one umbrella plan. Risk is underwritten at the group level, so there are no individual health checks, no exclusions for pre-existing conditions, and no large per-person cost.
- ✓Employer pays — employees benefit at no personal cost
- ✓Pre-existing conditions covered, no underwriting
- ✓Wellness benefits included (OPD, gym, mental health)
- ✓100% tax-deductible for the company (Section 37(1))
- ✓Digital enrolment — same-day coverage
Individual Health Policy
An individual or family floater policy purchased by the person directly from an insurer. The policy is portable and remains in force regardless of employment status, but requires individual underwriting and typically applies waiting periods for pre-existing conditions.
- ✓Portable — follows you regardless of employer
- ✓Section 80D deduction (up to ₹25,000)
- ✓Policy is fully in your control
- ○Pre-existing conditions: 2–4 year waiting periods
- ○Higher cost: ₹800–₹3,000/mo per person
Side-by-side comparison
Nine dimensions that matter most when choosing between group and individual health cover.
| Dimension | Group Health (GMC) | Individual Policy | Edge |
|---|---|---|---|
| Cost to employee | ✓₹145–₹400/mo (employer pays) | ₹800–₹3,000/mo (employee pays) | G |
| Coverage scope | ✓Team + family, pre-existing from Day 1 | Individual/family, waiting periods apply | G |
| Medical underwriting | ✓Not required — no individual health checks | Required — may exclude conditions | G |
| Tax benefit | Employer: Section 37(1) expense deduction | Employee: Section 80D (up to ₹25,000) | ≈ |
| Wellness benefits | ✓Included at scale (OPD, gym, mental health) | Not typically included | G |
| Onboarding | ✓Batch enrolment, digital, same day | Per-person application, paperwork | G |
| Portability | Employer-linked (portable on exit via IRDAI rules) | ✓Fully portable — follows the individual | I |
| Mid-year additions | ✓Anytime via app (new joinees, dependants) | New policy required per addition | G |
| Network hospitals | 10,000+ (varies by insurer) | Varies by insurer and plan | ≈ |
G = Group has the edge · I = Individual has the edge · ≈ Both have merits depending on circumstances. Price ranges are indicative for India as of 2026.
Why group health insurance wins for businesses
Three reasons group cover consistently delivers more value than telling employees to buy their own individual policies.
Cost advantage of 3–10×
At ₹145–₹400/employee/month (employer-paid), group health cover costs a fraction of a comparable individual policy. The group underwriting model pools risk across the team, making coverage dramatically more affordable per person.
Everyone is covered, no questions asked
No individual medical underwriting means no exclusions for pre-existing conditions, no health questionnaires, and no risk of rejection for any team member. Every employee joins on equal footing — a genuine benefit for diverse teams.
A retention and hiring tool, not just insurance
Offering group health cover signals that you invest in your team. For early-stage businesses competing for talent against larger companies, it levels the playing field. Employees who feel protected are more likely to stay.
Individual cover still has its place
Group cover wins for teams, but an individual policy is portable and follows the person — which is why it suits freelancers, solo founders and anyone between jobs. It is not a replacement for group cover so much as a complement to it. The list below shows exactly when reaching for one makes sense.
When individual health insurance makes sense
Individual policies are not the wrong choice — they are simply suited to different circumstances. Consider an individual policy when:
- 1You are self-employed, a freelancer, or a solo founder with no team
- 2You want coverage that stays with you regardless of your employer
- 3You need a specific sum insured or hospital room category that your group plan does not offer
- 4You want to supplement group cover with a personal top-up policy for family members
- 5You are between jobs and need continuity of coverage during the transition
Group health insurance wins on cost, coverage depth, and employee experience
For any employer, offering group health cover is almost always better value than asking employees to buy individual policies. You pay less per person, everyone is covered without underwriting, and the tax deduction makes the effective cost lower still. Individual policies complement group cover for employees who want portability — they are not a replacement for it.
Frequently asked questions
Common questions from founders and HR teams about group vs individual health cover.
Ready to offer group health cover to your team?
Onsurity makes it simple — monthly billing from ₹145/employee, digital enrolment, wellness included, and a Good Doctors concierge for every claim.
From ₹145/employee/month · Minimum 2 employees · IRDAI-regulated · 24h activation