Quick Summary
The sum insured is the ceiling on what an insurer will pay for covered claims during one policy year. In group health insurance, the employer chooses the sum insured per employee — commonly ₹1 lakh to ₹5 lakh — often uniform across the workforce or graded by seniority band.
How Sum Insured Works in Group Health
- Individual vs floater: On an individual sum insured, each member has their own limit; on a family floater, the employee and covered dependents share one pool.
- Exhaustion: Once the sum insured is used up, further costs fall on the employee unless a corporate buffer or top-up applies.
- Not the same as coverage: Sum insured is the monetary limit; coverage is the list of what the policy pays for.
Best Practice for HR Teams
Set the sum insured against typical local hospitalisation costs, and consider a top-up or buffer for high-cost claims rather than raising the base limit for everyone.
Get the right group health cover for your team
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