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Why Group Health Insurance is Essential for Tech Startups

Posted on 03 Sep, 2024

As a new startup, you could be asking yourself whether you should provide Group Health Insurance policy for your workers. Health insurance is no longer a benefit for large corporations, though it is imperative for startups and small businesses to continue recruiting and keeping top talent to keep the business afloat. Group health insurance has some great perks for startups. In this blog, we'll explore reasons why Group Health Insurance is essential for Tech Startups.

group health insurance

Why Group Health Insurance for Tech Startup Business is a Smart Move

Group Health insurance for startups is a group Insurance for your employees. As with all medical insurance policies in the country, GMC (Group Medical Coverage) is designed to cover your employee's healthcare if they are hospitalised - planned or unplanned. The group insurance policy usually pays for inpatient treatment and diagnosis of illness as well as hospital accommodation and nursing costs.

Why Should Startups Offer Group Health Insurance?

As a vibrant office culture is at the centre of any startup business' vision, you need to do everything you can to try to foster a 'happy-at-work' atmosphere. Here are some reasons a startup health insurance is important for a small company and its employees.

1. Access

Employees and loved ones will get various levels of medical care according to your needs and finances.

2. Speed

Better access to healthcare for employees puts you back in business faster.

3. Health and well-being

Offering health insurance helps you attract new talent and keep good employees.

Understanding importance of group health plan for startups

Whether large corporations, small and medium industries or startups, employee well-being is critical to keep employee morale high for the business continuity. The reasons startups should start offering Group Health Insurance policies to their employees are listed below.

a) It is a Security for Employees

As a fewer - employee startup, you can build trust with the GMC, which is on par with corporate health insurance plans for large organisations. Health Insurance for employees helps startups retain or recruit new talent, which is important for any startup.

b) Cost-beneficial Plan

The majority of the workforce may be young. Offer a low-cost health insurance plan to the company's youth population. They can also add their parents under the same plan for a premium if that is not part of the package.

c) Acts as Long-Term Investment

GMC provides financial stability and guarantees that employees and their families are financially protected in case of medical need. This increases productivity in the company. It also motivates employees because it provides financial protection in case of medical emergencies.

d) Benefits from Taxes

As a startup that offers group health insurance policies to your employees, you can get tax benefits.

e) Good Reputation in the Industry

Word of mouth is a powerful form of communication to position your startup among the best in the industry. A thoughtfully designed group health insurance plan for your employees makes you feel valued inside the company as well as outside the company.

Cost of group health insurance for startup

The price of group health insurance for a startup depends on the plan you decide on. It also depends on your business location, employee age, and coverage and benefits. A low monthly premium and high annual deductible are generally best for startups because employees are young and healthier. And as a startup, you have to offer new-age health insurance plans that allow for transactions and communications via a digital medium.

What type of group health insurance should a startup get?

The right group health insurance plan should be based on your startup's cost preference for group health insurance cover. Giving your employees a group health insurance policy should provide broad coverage at a low cost.

Consider these factors when selecting the right of health insurance for startups.

1. Provides upfront cost savings

Choose a group health insurance plan that maximises coverages to save money. An ideal plan should eliminate low-utilised benefits, lowering the premium for the employee health scheme. It should also provide flexible premium payment cycles such as monthly / quarterly / half-yearly / yearly so that the premium can be paid easily.

2. Provides access to primary care

Better primary healthcare eliminates unwanted future costs. A plan should focus on health outcomes to reduce costs. This is possible through access to high-quality primary care and wellness programmes (teleconsultations, OPD, lab tests, pharmacy, fitness and rewards, emotional support, chronic care management, etc.

3. Optional add ons

Having access to group health insurance policy add-ons that expand the coverage allows employees to amplify the policy. Add-ons like top-ups, consumables cover, financial protection, etc. are extensions of the basic group health insurance policy.

4. Offers app-based paperless claims

Most health insurance companies offer paperless claims. The process does not require employees to submit a hard copy or courier the documents to file a claim. Claims are processed on soft copies using a mobile app.

5. Provide seamless onboarding and endorsements

For reduced overhead and to eliminate monthly Excel files to onboard an employee or to endorse the policies, choose plans that provide a seamless, hassle-free and paperless HRMS integration.

6. Matches the coverage in the market

You decide the sum insured after analysing the market to find out what the average cover is offered. The rising cost of quality healthcare can eat into the monthly budget of the middle class family. Provide enough coverage for your employees. You can grow the coverage as your company grows in size.

7. Lowers employee expenses

Charges for room rent, co-pay and treatment-specific limits can increase the employee's out-of-pocket expenses. Therefore, plans that offer such features within limits will reduce employee expenses in medical emergencies and maximise policy value when a claim is filed.

8. Includes parents as beneficiaries

Most small businesses offer group coverage for employees, their spouses and children. As a new startup, you should cover their parents as well. Parents may be the primary beneficiaries of the group or business health insurance and will lessen the economic burden on the employee. You can win their trust as a company and attract the top in the industry.

9. Provides coverage from day one

A few small businesses provide group health insurance policies to employees after a certain period of time. As a startup, you can change that, and provide the coverage from day one. This will provide security and belonging for new employees and create a long-term employee-organisation relationship.

Group health insurance cost sharing for startups

You, as the employer, sponsor the employees 'group health insurance plan. Consequently, additionally you determine just how much to spend on group health insurance policy - and if you should split the cost with employees. You pay a proportion of your premium and the employee handles the remainder.

Also, as a startup and employer, you can add employee dependents. Whether you are taking the cost in part or even in whole, employees should also have the ability to add dependents on the policy.

FAQs

1) What is primary care in group health insurance?

Primary care is services that providers provide daily. Primary care services such as OPD, wellness programmes, access to diagnostics reduce the cost of healthcare in the future. A group health insurance policy for startups should cover primary care to improve employee health.

2) How to choose the right health insurance plan for a startup?

The biggest hurdle for a startup is keeping a lean budget while growing in the market. Set a budget to pay the premiums. For clarification regarding the terms and conditions, contact our support team.

3) What type of health insurance plan is necessary for a startup?

In line with a vibrant and dynamic culture, startups need a simple group health insurance plan with easy ways to file a claim. For new-age digital health insurers that offer digital or online group health insurance plans, choose new-age digital health insurers. The main benefits include access to primary healthcare (teleconsultations, pharmacy, lab tests, OPD) and paperless claims through a mobile app.

4) What is the full form of GMC?

The full form of GMC is 'Group Medical Cover'. The term is used in health insurance that covers a group of persons or employees.

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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. (Group Health Insurance,4016 , ICIHLGP21381V052021)