Group health insurance can be defined as a health insurance policy that provides financial compensation to the insured in case of hospitalization due to any of the illness or disease mentioned in the policy in return for a nominal amount known as a premium. The premium can be paid in one go or in installments. This is the group health insurance definition in which the insurance company would compensate the insured for the hospitalization expenses.
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Health insurance is available in two types:
Group health insurance and retail/personal health insurance. Group health insurance is usually taken by employers or organizations for their employees, whereas retail or personal health insurance is taken by normal people. On payment of an additional premium, there is a provision to add the family members and other dependents in the retail or personal health insurance policy.
The personal health insurance policy can be taken on a floater sum insured or fixed sum insured basis in which the sum insured would be floating in the former whereas there would be fixed sum insured per person in the latter.
Health insurance is a type of insurance policy that provides hospitalization and other related expenses to the insured in case of treatment due to any illness or disease mentioned under the terms and conditions of the policy.
The maximum amount of liability of the insurance company in any case would not exceed the sum insured mentioned under the policy. The insured would pay a certain amount known as premium in return for the coverage provided by the insurance company.
A health insurance policy can be taken for short term as well as long term. Short term policies are issued for a period of 1 year whereas the long term policies are for a period of 2 and 3 years.
The sum assured in group health insurance is the maximum liability of the insurance company in case of hospitalization during the policy period. The sum assured under the group health insurance policy would start from ₹ 50,000 and can go up to even ₹ 1 Crore depending on the requirements of the organization.
For sum insured of more than ₹ 10 Lakhs, special underwriting conditions are to be followed by the insurance company. The sum assured in group health insurance would be decided by the employer or the organization at the time of taking the policy.
There can be a level sum assured in group health insurance in which the sum insured would be the same for all the members or families under the group health insurance policy. There can also be the variable sum insured in the group health insurance policy where there can be different types of sum insured options for different members/families.
The group health insurance premium is calculated on the basis of the sum insured option opted by the customer as well as the age of the members. A higher sum insured leads to higher premiums under the group health insurance policy. The sum insured under the group health insurance policy is the maximum claim amount payable in case of hospitalization during the policy period.