How Does Personal Health Insurance Differ from the One Provided by the Employer?
January 03, 2018
Most of the business owners and the self-employed individuals have to get health insurance on their own. However, the salaried individuals have the advantage of getting the same from their employer. But is there a difference between the two? The answer is “yes”.
The following are some of the main differences between an individual health insurance, and a group health insurance which is given to the employees by the employer:
- Waiting Period
In the majority of the individual health insurance policies, the customer has to wait for a certain period before they can claim the health insurance benefits. Usually, it’s around 30-60 days. However, for many major diseases and expensive surgeries, the waiting period could be as long as 2-3 years.
On the other hand, the group health insurance policies provide coverage without any waiting period. Thus, the insured employees get the benefits from day 1.
With an individual health insurance policy, the customer has a lot of flexibility as to the amount of insurance cover, diseases covered, and other terms and conditions, etc.
A group health insurance coverage doesn’t offer much room for flexibility. This is because the policy is picked by the employer and the policy itself is the same for the entire staff.
An individual health insurance policy continues to be valid as long as the customer pays the premium on time. However, a group insurance policy ceases to be valid when an employee changes their company or resigns for some other reason.
- Premium Cost
The majority of good standalone health insurance policies come at high premiums. The group health insurance policy, on the other hand, is cheaper. This is mainly because these policies are sold to a large number of people as a big-ticket item. Thus, the premiums for these are quite competitive.
A lot of people who get health insurance from their employer often get an individual health insurance policy too to cover certain aspects that aren’t covered in the group policy, or just to raise the total coverage amount.