Most employed professionals receive health insurance from their employers known as the company insurance or corporate insurance policy. These policies offer cover for the employee, his/her spouse, children, and even parents. Since the company pays the premium, most employees don’t think about whether the policy offers sufficient coverage or not and usually don’t buy another insurance policy. However, during a medical emergency, many people realize that they could have taken a better policy to manage medical costs. Today, we are going to look at whether a corporate health insurance policy is enough or if you need to consider buying a separate policy for your family.
Corporate insurance is common nowadays, with companies trying to express that they care about their employees. However, depending on the number of employees in the organization, the company determines the cover that is financially feasible too. Hence, in many cases, the coverage amount is low.
Every individual and family is unique and has distinct medical requirements. Hence, the coverage amount can vary. If your employer is extending health insurance, then it is important to assess the amount and kind of coverage offered by the policy. If it doesn’t meet your requirements, then you must ensure that you purchase a separate health plan to ensure maximum coverage and manage medical emergencies in the future.
You are covered as long as you are employed
The corporate world is a volatile place. Economic uncertainty is the theme of modern times, and job cuts or layoffs are a regular affair. If you lose your job, then apart from the obvious loss of income, your health insurance cover lapses too. Imagine having to deal with a medical emergency at such times. You will have to bear all costs yourself. With medical inflation rates hovering around 18%, treatment costs can burn through your savings in no time. Hence, it is important to remember that with corporate insurance policies, your cover lasts for as long as you are employed. Since medical emergencies come unannounced, it is prudent to have an independent health insurance policy.
Lack of customizability
While a corporate insurance plan offers financial protection against medical costs incurred by the employee or his family, most corporate policies do not allow employees to make major changes. So, if you have a corporate insurance policy and want to increase the coverage amount or add to the list of illnesses covered, then a corporate policy might not allow you to do the same. When you purchase a policy directly from a reliable insurer like Tata AIG, you can customize it to a great degree to make it suitable for your requirements.
Corporate policies lapse with your retirement
While we spoke about job losses above, there is another aspect that you need to consider – retirement. Since the company offers health insurance to its employees, it will pay the premium until the day you retire. Hence, on retirement, the policy will lapse, and you will be left with no health insurance at a time when you need it the most. Also, if you haven’t purchased an independent policy until then, finding an insurer who is willing to offer a policy at that age can be difficult and/or very costly.
Health insurance policies offered by companies are advantageous since you get coverage without having to manage the burden of paying the premium. However, instead of relying solely on the corporate health insurance policy, it is prudent to also purchase an independent cover. You can buy multiple health insurance policies and use them for separate things. For example, you can use the corporate policy for minor medical costs and your independent policy for anything major. While some people might argue that this would lead to being over-insured, since you are not paying the premium for one policy, this is a better option than being under-insured.
Also, many corporate health insurance policies have limitation clauses. Some companies offer policies with a co-pay clause where the employee has to bear a certain part of the claim amount himself. Others limit hospital room rent costs, etc. to minimize costs. Hence, we always recommend employed professionals to treat their corporate health insurance as a secondary policy and purchase a primary policy based on their needs. If you are a nuclear family with your spouse and one child, then ask yourself if you have enough health insurance for a family of 3. Research your options well and choose what’s best for your family.
Remember, health insurance is about having financial protection during medical exigencies when you need it the most. While a corporate policy might sound like it fulfils the need, you must ensure that you go through all the inclusions and exclusions of the cover to determine if you need another policy or not. With medical treatment and hospitalization costs increasing every year and medical inflation rates climbing much faster than salaries, a comprehensive health insurance policy is a must. Assess your family’s medical history and requirements and choose a policy that offers the most comprehensive cover at the best premium rates. Good Luck!