What is Group Health Insurance? | Features and Benefits

OkBima 16 Jan 2023


What is Group Health Insurance? | Features and Benefits

Group health insurance is a policy that covers a group of people, typically employees of a company or members of an organisation. It offers coverage to eligible individuals and sometimes extends to their families. Employers often negotiate with insurance providers to secure group policies that offer favourable terms and rates compared to individual plans.

However, the cost is significantly lower than individual health insurance plans, and it also saves companies money in the form of tax breaks, making it a win-win situation for both the employer and the employee.


How Group Health Insurance Works?

Group Health Insurance is a policy provided by employers or organizations to cover a group of individuals, usually employees and sometimes their families. The insurance company designs the policy with specified coverage and benefits.Employees enroll in the plan during specific periods, and the cost, known as the premium, is shared between the employer and employees. Employees' contributions are often deducted from their paychecks. The policy outlines coverage, including in-network healthcare providers who offer services at lower costs.

Insured individuals can access medical services within the network by scheduling appointments or seeking treatment. They may need to pay a co-payment or co-insurance based on the plan. When they receive medical care, the healthcare provider submits a claim to the insurance company for reimbursement.

The policy is usually reviewed annually to assess its performance and make necessary adjustments. Group Health Insurance ensures employees have access to necessary healthcare services, encourages preventive care, and provides financial protection against high medical expenses. It also helps employers attract and retain talent by offering a valuable benefit that demonstrates care for their employees' well-being.


Feature of Group Health Insurance 

Group Health Insurance offers a range of valuable features for both employers and employees:

1. Comprehensive Coverage: Group Health Insurance typically provides coverage for a wide array of medical services, including hospitalization, doctor visits, prescription drugs, preventive care, maternity benefits, mental health services, and more.

2. Cost Sharing: The cost of premiums is shared between the employer and employees, making healthcare more affordable for the entire group. Employers usually cover a significant portion of the premium.

3. Network of Providers: Insurance providers often have a network of preferred healthcare providers, allowing insured individuals to receive medical services at reduced costs when using in-network providers.

4. Flexibility and Customization: Employers can tailor the plan to suit the needs of their employees, offering different coverage options and additional benefits based on the group's requirements and budget.

5. Family Coverage: Group Health Insurance plans may extend coverage to employees' families, providing essential health benefits for dependents.

6. Tax Advantages: Employers may benefit from tax deductions on premiums paid for Group Health Insurance, and employees' contributions are often made with pre-tax dollars, reducing taxable income.

Group Health Insurance stands as a crucial tool in attracting and retaining talent, enhancing employee satisfaction, and ensuring a healthier, more productive workforce.


What are the benefits of Group Health Insurance?

As the saying goes “A happy employee is a productive employee” which further enhances the productive capability of your organization. Group Health Insurance is a great steppingstone towards this process.

The following are the benefits of Group Health Insurance-

1. Motivates the employees- Employees that are happy at work create pleasant workplaces and, as a result, successful businesses! It’s no surprise that the safer and more pleased the employees feel, the happier and more driven they are likely to be!  

2. Protection against severe health conditions- In India, lifestyle-related diseases account for more than 61 percent of hospitalizations and deaths. Protect your staff from the same

3. Mental Wellbeing of the employees- Many employees are stressed out as a result of financial pressures or other personal concerns, which can contribute to decreased productivity at work. With the correct help in mind, group health insurance plan will not only protect their finances but will also improve their entire mental wellbeing.

4. Increases Employee Retention- People place a premium on occupations that provide them with a sense of security. A group health insurance plan will provide your employees and their families with not only financial security, but also a sense that their employer cares about them.

So, be the employer who actually cares about the employees by providing your employees with meaningful benefits and get an edge over the competitive market!!


How Many Employees Do You Need to Qualify for Group Health Insurance? 

Well, that is a very good question you asked! Generally, any organisation with ten or more members should provide health insurance to their employees. We break it down for you if you’re not sure if you need one.

1. Small companies & young start-ups- If you’ve just established your own business and have at least 2-50 employees, you can buy group health insurance plan that will not only protect your employees but also help you save money on taxes. Don’t be concerned about the costs; group health insurance policies are tailored to the company’s financial and workforce strength.

2. Medium sized companies and growing start-ups-  If your business is new, then you need 51- 250 Employees but it’s been around for a long time. A group health insurance plan can help you protect your employees. This will not only increase your employees’ satisfaction and motivation, but it will also help you keep them for a longer period of time.

3. Large Organisations and established start-ups- Employees expect perks such as health insurance as part of their package because the company is large and established. So, if your firm is well established and large enough, you need More than 251 Employees in your organisation. 


What are the advantages of Group Health Insurance?

Now, let’s wind up with highlighting some major advantages that you will be enjoying because of Group Health Insurance.  

1. Low-Cost Premiums- Because the cost of a group health insurance coverage is shared among a group of people, it is far less expensive than other health insurance policies.

2. Tax Benefits- Companies who provide their employees with corporate health insurance can save money on taxes, according to the Income Tax Department of India.

3. Company Goodwill- Employees are happy and work settings are happier when their employers provide them with significant benefits. This, in turn, leads to increased goodwill for any organisation, large or small.

4. Recruitment Advantage- Providing group health insurance can give employers a competitive edge in attracting top talent. Prospective employees often consider the benefits package, including health insurance, when evaluating job offers.


Buy Group Health Insurance with Okbima

Discover the convenience of securing group health insurance through Okbima. Our platform simplifies the process, allowing you to effortlessly compare and customize insurance plans from top providers. We prioritise transparency, ensuring you comprehend coverage and costs. Trust Okbima to streamline your search for the ideal group health insurance, promoting employee well-being and business success.



Group health insurance is a valuable asset for both employers and employees. It offers cost-efficiency, tax benefits, and enhances employee satisfaction for employers, while providing affordable and comprehensive coverage for employees and their families. By understanding the advantages and considering key factors, businesses can make informed decisions about the right group health insurance plan for their team. It's a win-win situation that prioritises the well-being and financial security of all involved.


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