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Hello My Dear Friends, I have a query related to Mediclaim for my office staff. We are planning to provide Mediclaim benefits to our staff under the Group Health Insurance ( GHI) scheme of a private Medical Insurance company. Can you please help me to understand whether the annual premium payable will have to be borne entirely by the company, or whether a part of it can be recovered from the staff as monthly deductions from salary? If so, the deduction should be under what head and what is the general percentage of premium amount that can be recovered from staff?

Also, will it be a wise decision to deduct a percentage of the premium amount from staff pay and thus compromise their net take-home salary?

Kindly advise. Looking forward to your suggestions. Thank you in advance.

From India, Kolkata
Partner - Risk Management
Deputy Commissioner Of Labour..a.p.


Though provision of mediclaim insurance not statutory, Big business houses covering their employees in these policies for protection of them and their families in case of any medical emergency.
Premium will be based on age, coverage limit, extension of benefits and for a new company first year premium would be normal. But based on the subsequent claims, the next year premium will be decided by the Insurance company. Go for public insurance company instead of private as Public sector Insurance would be cheap and would accept your assurance.
With regard to deduction from employees, It is purely discretion of the management, it can be either free or 50% contributory for employee side.
The provision of medical insurance to your employees will have better edge over your competitors in case of recruitment, appraisal, welfare and retaining of talents with your company.

From India, New Delhi

there is no regulation that says either way whether you have to pay it from the company or recover from the employees.
It is a decision of the management keeping in mind HR / IR issues and whether they want to give it as a perk (or show higher CTC).
The decision needs to be made based on various circumstances that we do not know of.
However, the amount is probably small and it should not make a significant difference to the company.

From India, Mumbai

Ya firstly I do greet you for having an idea of introducing family coverage insurance scheme to your staff.

Then come to the issue it must be a public insurance company, why the staff feel a bharosa we r covered by a national institution... They would be thankful to you if it is a govt backboned public limited like LIC UIC GIC etc. Why only choose Govt. Supported Insurance company ... is usually a private insurance company has a jurisdiction limited service ,notified hospitals identifed limits like cities and some areas and some notified hospitals corporate nature available in mega cities only. And pvt. I. nsurance companies say if any service dispute raised by policy holdres all such legal disputes will be in their HQ area Courts only. And it is known fact...

Usually factories landed in outskirts of cities and villages rural areas.

Moreover the Govt. Assured insurance companies have jurisdiction like entire state or entire India ...irrespective of rural and cities corporate hospitals and private clinics.

So that it is prefferable a govt. supportive insurance company only.

Then come to premium there are 2issues wise suggestions.

If you totally bear all premium annual it is very good decision and your staff show great regard on the Employer.

While come to second issue

If the company falls loss the company opts for cut in expenditures. So obviously chooses to stop the free insurance to the staff. Then the worker looses the benefit of insurance coverage. This is happened recently in an Aero electricity company. First 2years the company bore freely payment of premiums to all staff.

On the consequent years the company stopped paying free insurance to it's workers. In the joint meetings they raised a demand praying atleast give us their individual policy no. s. So they can pay premium and continue their policies a/c s. in that insurance company. But some other ego reasons the company deferred.

So if you are sure the company is a economically sound and never stops free payment of premium you carry on. If you are not sure made alternate year free payment. First year the company freely pay all premiums of all staff. Second year the staff bears by collecting individually from staff and renew their A/c sinn that insurance company.

The idea of 50/:50 is wrong. The staff suspects your charity and it also creats doubts on your share of payment of premium.

So better choose a public limited central govt. run insurance company beyond any doubts of innocent families of staff.

Choose and preffer alternate year free total contribution of all staff premiums..

All the best. Go ahead.

From India, Nellore
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