Requirements For Buying Group Health Insurance

A guide on the minimum requirements for buying group health insurance
Team Loop Health
June 10, 2021

Challenges like financial issues, healthcare costs, and troubled mental wellbeing exposed by the COVID-19 pandemic reached a new critical level. With the link between workplace productivity and stress, as an employer, it’s in your best interest to make sure your workforce has all the pertinent resources to feel supported and safe. Proactive preparation will ensure you protect your business to weather the storm as well as maintain top-line growth.    

Group health insurance (GHI) is something that will give you peace of mind plus, it’s a future-proof approach to healthcare and benefits. To secure a comprehensive healthcare solution that rightly aligns with your company, your organization needs to meet the eligibility criteria. Let’s see what that is.

Eligibility Criteria for Group Health Insurance

Typically, group health insurance plans are an employer to employee. However, non-employer to employee groups are eligible too.

So, whether you’re a small or large-scale organization, emerging start-up, or a group with a common interest, you can get group health insurance, provided you meet the following criteria.

1. The minimum number of employees - According to the Insurance Regulatory and Development Authority (IRDAI), a minimum of 7 or more employees must be present in a business/enterprise/organization to apply for group health insurance. Employees can be family members as well, say a family business. But, the employer to employee relationship must be present.

2. Registered business - You need to officially register your business and you need to have the appropriate paperwork as well as possess a GST number.

Note: Group health insurance premiums are cheaper and so, you cannot form a group/business for the purpose of purchasing insurance. This can lead to the refusal of insurance by the insurer. Ideally, the business should already be engaged in economic activity and not begin work after enquiring about group health insurance.

Who is Not Eligible for Group Health Insurance?

As with every insurance, group health insurance also has certain limitations. If your organization falls under any one of these categories, you will not be eligible for group health insurance.

a) Single entrepreneur

If you’re a single entrepreneur with no employees, you’re not eligible for group health insurance. However, you can apply for individual protection to ensure you’re protected.

b) Family business

Under family business, if the family business is made up of both family members and non-members then the spouse is eligible for group cover. If the business consists of only family members, typically the spouse is not covered.

Exceptions for Group Health Insurance

a) Eligible dependents

Group health insurance covers eligible dependents. The employer or non-employer can either contribute to cover the cost of dependents or allow employees to pay an additional premium to include dependents in their policy.

b) Certain companies who otherwise wouldn’t qualify for group health insurance can make the cut because of specific group dynamics. Like those who work with part-time or contractual workers can apply for group health insurance.

c) If an organization has a majority of its employees over the age of 65, it’s a special case and they can qualify.

What If The Number of Employees Reduces After the Policy is Issued?

Let’s assume you had 8 employees when you purchased the group health insurance. All of a sudden, one employee decides to switch jobs. Now what?

Luckily, there’s no reason to fret. Such limitations are only applicable when you purchase your policy. Thus, your present policy will continue as it is until the time of renewal. Such considerations will be accounted for only during renewal. However, at the time of renewal, the insurer can make room for certain relaxations like insuring 6 employees for a marginally higher premium.

Group Health Insurance - Your Team’s Way To Navigate The Road Ahead

As a business owner, an HR, or manager, your agenda is choc-o-block. You’ve got plenty to do and which is why you can leave your health insurance needs to Loop Health while you focus on your goals.

We ensure the holistic wellbeing of your employees with comprehensive coverage including value add-ons like free OPD care, discount on lab tests, wellness plans, mental and dental cover. Plus, with customized plans, you have choices in building a healthy, engaged workforce.

And with us being with you every step of the way, you’ll have the best-in-class experience.

Interested?

I’m ready to sign my business up for a healthy tomorrow!

Want to learn more about Buying Group Health Insurance? Click here

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