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How to Calculate Group Health Insurance Premium

Posted on 08 Jul 2021

Group health insurance forms an important component of employee benefits package of organizations. It offers medical coverage to employees of an organization at a low cost and acts as an essential employee retention tool.

You, as an employer, need to pay premium towards group medical insurance, and there are many factors that influence it. Given below are the multiple factors that affect premiums towards a group health insurance policy.

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Factors Affecting Group Medi-claim Policy Premium

Number of Employees Covered

This is one of the essential considerations for premium computation towards group medical insurance. The premium amount is directly proportional to the number of employees covered under group health insurance. It means higher the number of employees, greater is the premium amount.

Sum Insured

Sum insured refers to the maximum amount of coverage offered by a health insurance plan. The premium amount is heavily influenced by the sum insured. Higher the sum insured, greater is the premium and vice-versa.

Age of Employees

Age is a critical factor while buying health insurance, and group health insurance policy is no different. Risk increases with age as the body becomes vulnerable to several ailments. If the employees’ age is on the higher side, you need to pay a higher premium towards the plan.

Nature of Occupation

The type of occupation you are in radically influences the premium amount. If you are in a high-risk occupation, then it poses a greater risk to employees’ well-being and health. In such a scenario, you are charged a high premium towards your group medi-claim policy.

On the other hand, if employees are involved mostly with desk jobs, premiums are on the lower side as the risk is low.

Coverage for Dependents

In many cases, group medi-claim plans cover dependents of employees, including spouse, children, and parents. In case the plan covers the covers them, premiums would increase.

It also takes into account the number of dependents covered and their age. If dependents are in high number and are aged, the premium amount increases significantly.

Past Claims

Past claims experience is also taken into account while computing premiums. If there have been frequent claims in high volumes, then the premium goes up by several notches. On the other hand, if there have been limited claims in the past, then the amount is on the lower side.

Add-on Covers Opted

Just like an individual health insurance plan, you can customize a group medi-claim policy by adding relevant riders or add-ons. If you choose to opt for add-ons in your base plan, the premium would go up.

The Final Word

These are some of the essential factors that influence premium in a ICICI Lombard Group Health Insurance policy.In most cases, the employer bears the premium towards this plan that has become an organizational necessity in modern times.

  • Group Health Insurance
  • Product Code: 4016
  • Product UIN: ICIHLGP21381V052021

This contains only an indication of the cover offered. For complete details on risk factors, terms, conditions, coverages and exclusions, please read the sales brochure carefully before concluding a sale.ICICI trade logo displayed above belongs to ICICI Bank and is used by ICICI Lombard GIC Ltd. under license and Lombard logo belongs to ICICI Lombard GIC Ltd. ICICI Lombard General Insurance Company Limited, ICICI Lombard House, 414, Veer Savarkar Marg, Prabhadevi, Mumbai – 400025. . IRDA Reg.No.115. Toll Free 1800 2666. Fax No – 022 61961323. CIN (L67200MH2000PLC129408). customersupport@iciclombard.com. www.icicilombard.com. (Group Health Insurance, 4016 , ICIHLGP21381V052021)