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Tips for Choosing the Right Labour Insurance Plan for Your Needs

Posted on 25 Apr, 2024
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Health insurance is an important financial instrument that covers the costs associated with medical treatments and procedures. For businesses, this concept transforms into group health insurance. This means that all employees receive the benefit of health insurance under a single policy.

A right labour insurance plan is advantageous for businesses as it does not put them under financial strain. It is a win-win as it safeguards your employees' health and shields you from unexpected medical expenses.

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Understanding Labour Insurance

A labour insurance policy provides financial protection to employees for work-related injuries, illnesses, or disabilities. It is popularly known as workers' compensation.

It typically covers the following components:

  • medical expenses

  • lost wages

  • rehabilitation costs

  • disability benefits

All these specifics can differ depending on the industry, size of the workforce, etc.

Labour insurance aims to ensure the well-being of employees and protect employers from potential legal liabilities.

Why Should Businesses Invest in Labour Health Insurance?

Investing in the right labour insurance plan is not an expense. It is an investment in your employee’s well-being and the continuity of your business. Here is what choosing the right labour insurance plan can do for your business

Attract and Retain Talent: Companies offering health insurance demonstrate concern for their employees’ well-being. This is especially important with the rising healthcare costs and increasing burden of non-communicable diseases. This helps them attract top talent to their business.

Boost Morale and Productivity: Medical emergencies can lead to sudden and huge financial outflows. Health insurance reduces stress about medical emergencies among employees. This can help in boosting their focus and productivity levels.

Ensure Financial Security: Medical issues can come all of a sudden with significant financial consequences. Labour insurance helps offer financial security during medical emergencies. It ensures access to quality healthcare without worries about costs.

Gain Tax Benefits: The premium paid for group health insurance qualifies for tax deductions under Section 80D of the Income Tax Act. This helps in reducing the business’s tax liability. It also frees up funds for growth.

Legal Compliance: Group health insurance is mandatory in India, as per the IRDAI circular issued in April 2020. Providing group health insurance helps businesses meet these legal obligations.

Tips for Choosing the Right Labour Insurance Plan

A labour insurance plan is a crucial investment for employees by any business. Follow these tips to choose the right insurance plan:

Understand the type of employee health insurance policies

You can consider the following categories of health insurance policies

Individual policies: These have to be purchased for each employee individually. But these can prove to be costly.

Group health insurance: These policies are specifically made for organisations and are cost-effective, providing coverage to all employees under a single plan.

Calculate your employee’s needs

You need to assess the labour insurance needs of your employees. This will depend on factors like their age, medical history, nature of the job, etc., to calculate the exact coverage requirements.

Analyse multiple plans

Look into different plans offered by various insurers. Do not settle for the first policy you come across; compare several to identify the best fit for your insurance needs.

Look into network hospitals

Verify whether your chosen insurer has a wide network of hospitals. This will ensure your employees get coverage at their nearest hospital during medical emergencies.

Read the policy terms and conditions

Make sure you carefully read the policy’s terms and conditions to understand the exclusions and procedures for claim settlement.

Add-on covers

You can easily enhance the scope of coverage of your group health insurance plan with add-on covers. These could include coverage for OPD treatment, maternity-related expenses, and treatments for critical illnesses.

Conclusion

Selecting the right labour insurance plan is important for both employers and employees. A labour insurance plan is a crucial safety net in case of health emergencies. Not only does it ensure legal compliance, but it also creates a sense of security in the workplace. Group health insurance generally proves cost-effective, and selecting the right labour insurance plan requires carefully assessing your employees' needs and comparing the policies of different insurers. Depending on your employees' requirements, consider add-ons. It is also crucial to look at the reach of network hospitals.

A well-chosen labour insurance plan not only mitigates financial risks associated with workplace injuries/illnesses but also promotes employee retention and satisfaction. It minimises business disruptions and ensures the smooth functioning of business operations.

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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. (GHI Insurance, 4016 , ICIHLGP21381V052021)