Do I need to buy a personal health insurance if I am already covered in a workplace group policy? Most working professionals will ponder over this question and a few may even decide, unwisely, on not taking a personal cover. Personal insurance should be the bedrock of protection, which functions irrespective of one’s employment status. Also, coverage, customisation, and features of a personal cover supplement the protection provided by group insurance. While cost may seem high, the value derived from always being insured should take precedence.

Perks of group policy

While ‘all time coverage’ is the basic draw of having a personal cover along with a group cover, there are advantages and disadvantages that distinguish both.

Group cover is better in terms of waiting periods, maternity, and extended family. Group covers kick off from day-one. Owing to the size or as a function of large numbers, group insurance can cover diseases from day-one without waiting period for pre-existing diseases (PEDs). PED waiting can range 2–4 years in personal covers. Also, group policies generally cover maternity as well. This feature has to be specifically searched for in personal covers and will be priced at a premium, making group policy a useful tool in such cases.

Group policies offered at the workplace may most likely cover spouse and children in the same policy, which is helpful. But more so, coverage to parents or in-laws is a valuable feature. Most likely at an additional cost, group policies offer coverage to senior folks at better than market price. Covering the family at one go is an added advantage, but will be subject to coverage limitations of a group policy.

Coverage and extent of coverage are the primary disadvantages of having only group cover without a personal cover. A group cover is negotiated by the company and coverage limit may range from ₹1 lakh to ₹5 lakh per employee. At the lower end, this may be insufficient to cover hospitalisation expenses, especially if in a tier-I city. An employee cannot increase the limit or apply for an individual top-up of the limit with group covers. This is complicated further if employee family is also covered in the same lower cover. Also, restoration benefit, which is common in personal covers (restores coverage for a second health issue in a year), may not apply for individuals in group covers. Irrespective of the coverage limit, the policy will automatically switch off the moment the employee is not on the payroll of the company.

Foundation with a personal cover

A personal health insurance is a safety net and a key financial product for all. But in supplementing a group cover, personal covers can incrementally offer higher coverage, customisation, and continuity. In times of career transition or disturbances, personal covers are the main insurance policy that will be relied on till one’s old age. Even with active group cover, a personal cover can provide a higher coverage limit when high-cost medical care is required.

Personal covers can use the accumulated NCB (no claim bonus) and restoration benefits to stretch out even a basic ₹2-5 lakh cover. Also, for procedures in oncology, cardiology, renal and neurological care that exceed ₹15-20 lakh, personal covers can be further supplemented with top-up policies that are triggered over a predefined limit and covering a large portion of outlying risks.

Customisation to one’s needs is achievable through personal covers and not in group covers. OPD add-ons, disease-specific covers with focus on diabetes, cardiac and oncology, policies that reward an active lifestyle, add-ons and riders for room rent capping, travel-specific covers and many other features are cu,rrently accessible only with a personal cover. Until such product innovation reaches group covers policyholders maximising value from such customisation can do so from personal covers alone.

It may be necessary to disclose the two insurances, but depending on coverage limits, any one can be used for the procedure. But the pace of processing will be the same across. In cases where one policy’s coverage limit may not be sufficient, both policies can be used by informing both the insurers about the claim simultaneously.

On the cost front, a group cover may cost ₹3,000 to ₹4,000 for a ₹2 lakh cover (borne by the company) and a personal cover can start from ₹7,000 for a ₹5 lakh cover.

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