The Biggest Problem with Group Health Insurance- Advantages and Disadvantages, and How You Can Fix It?


If you are looking for a group health insurance plan, we hope you have read our guide to the pros and cons of different types of health insurance plans available on the market today at Health Insurance Company (HIC).

employees sitting in the meeting room -group health insurance advantages and disadvantages

Essentially, everything, in the end, is profit-oriented. Even when you talk about any non-business-related decision in life, we are always checking to see what will serve us best. There is nothing wrong with profit, and the big question is what makes something profitable.

Simply put, when something is more advantageous than disadvantageous, it is profitable. So essentially, when the return is more than the risk, it is profitable, so knowing advantages and disadvantages essentially aids us in making profitable decisions.

Hence, we are expounding the advantages and disadvantages of the Group health insurance policy to make it worth your while.

Group health insurance advantages and disadvantages - list

Advantages of Group Health Insurance Policy:

  • Less amount of premium if a premium is involved.
  • Policy for all – smokers, and alcohol users. There are no medical tests required for getting a group health insurance plan. At one level an organization will offer similar coverage to all its members.
  • Provision of adding family members – even older parents
  • Group health insurance plans also cover pre-existing diseases. For instance, if someone suffers from asthma and during the smog full winter, a severe attack requires them to be hospitalized. If you just bought an insurance policy recently, you would not get coverage in an individual plan, all expenses would have to be paid out of pocket. Whereas in GHI you will get coverage.
  • Maternity benefits, ambulance charges, and OPD consultations can be covered in GHI.
  • You can get tax benefits on it as well.
  • Cashless is easily available in GHI.
  • Coverage starts from day 1 of the policy and you don’t have to wait for any time before filing any claims.
  • Works as a motivating factor

These were a few advantages of a group health insurance policy, now let’s move on to another segment.

Disadvantages of Group Health Insurance Policy:

  • Not enough cover, usually the total coverage amount isn’t sufficient to cover all medical needs, that too for everyone in the family.
  • Non-customized plans: Since these plans are designed for a large group they work on size fits all basis, however, we all know that life is different for everyone, and health insurance should be personalized to cater to one’s needs.
  • The tax benefits would depend upon the amount of investment. If no premium no tax rebate. So out goes the financial planning.
  • Uncertainty: This is the biggest risk or disadvantage of a group health insurance plan. Since an organization provides these plans your coverage only lasts till you work on the job. If you change your job or are no longer working you can find yourself exposed to the perils of no coverage. Additionally, the plans are dependent on the employer which they can change when they deem fit. Like the coverage, the amount can be decreased.

Are you convinced or still want to know more?

Now that we know the advantages and disadvantages of a group health insurance plan, we can make informed decisions. As to the solution for tackling the biggest challenge of the group health insurance plan – get an individual plan, so no matter what comes, you are always covered and always prepared.

Your plan will allow you to choose the kind of coverage you need. You can get additional benefits that may cater to you specifically.

You will not have to worry about not being covered if you retire, and having both group health insurance and an individual plan will allow for your pre-existing disease clause to be covered after a while. That covers all possible angles on health insurance.

Everybody defines success in different ways, but honestly, I feel success is never one thing – it is a series of right decisions taken promptly that allow you to live a happy and healthy life. We hope you found this information about the pros and cons of group health insurance useful.

Get Quotes for Group Insurance

How many staff
do you need to cover?

Susheel Agarwal

Susheel is the CEO of Ethika Insurance Broking P Ltd. This company, which has a current value of 10 million dollars, was bootstrapped by him and two of his friends. He attributes his success to his ability to inspire others to seek happiness at work.