As per Insurance Regulatory and Development Authority of India (IRDAI), a company with 7 or more lives is qualified to get group health insurance. However, it is up to the insurers to decide the minimum size they want to cater to. Commonly public insurers prefer offering group health insurance to companies with more than 100 lives and private insurers offer it to companies with more than 50 lives.

What’s the exception?

1. As mentioned, insurers take into account the number of lives and not the number of employees. So companies can add in family members of the employees. Assume you got yourself an insurer who is giving you group mediclaim policy for a minimum size of 7 lives. You have only 5 employees in your company. So you can also count the parents of the employees to increase the number of lives. Generally, companies with less than 200 employees ask for 100% enrollment of parents.
2. Part-time workers are not eligible for group health insurance. However, if your company has less than 7 employees but has a workforce majorly working part-time, then you can get employee health insurance. However, today a lot of insurers are open to including contractual employees also.
3. As per regulation, people above 65 years of age are not eligible for group health insurance. But if your workforce is primarily made of old people, there are provisions to get employee health insurance policy.

How number of employees impact your group insurance premium?

When you go to a wholesale shop and buy 200 notebooks, you can ask the shopkeeper for a discounted price. Let’s say 200 notebooks cost Rs 2000 and you get a discount of Rs 100. If you buy just 10 notebooks, then you will hardly get any discount. This is the same way group insurance work.

When you have a big employee strength, you can negotiate the price better. However, it is also important that with a bigger employee strength, comes a bigger claim dump. If many employees claim huge amounts in a year, then the next renewal might get a bit expensive as insurers would want to compensate for the money spent on settling claims.

Also read: Group health insurance premiums

What happens if the employee size goes lesser than the minimum size after group health insurance is issued?

The limit applies only at the time of issuance of a group medical insurance policy. If the number decreases after you get your group health insurance it won’t be a problem. However, when you go for renewal, which happens annually, you need to have the minimum size that your insurer dictates.

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