Health Insurance for Teachers: Should New Joiners Get It Too or Only Long-term Staff?

Dear respected community members,

Our school is planning on offering our teachers health insurance. I wanted to ask all of you a few questions. Should we offer the health insurance only to teachers who have worked here for 2+ years as an incentive/reward for staying with us, or should we offer it to everyone, new joiners included, as part of their compensation?

Please keep in mind we are a relatively new school in a semi-rural location, but we are striving to develop a healthy work environment that is employee-friendly. Additionally, most private schools in our region do not offer this benefit.

Your opinions would be greatly appreciated.

Kind regards,
Mr. Phuntsog Pulger

Dear Colleague,

Employee Wellbeing: A Pillar of Modern HR Practice

In modern-day HR practice, "Employee Wellbeing" is an important pillar to focus on and strengthen. Our sincere appreciation goes to you and your organization for this fine idea, especially when many business organizations are still not thinking in this direction. Keep it up!

Health and Wellbeing: A Universal Subject

Coming to this specific point, you will agree that "Health and Wellbeing" is a common subject applicable to everyone. It should not be selective based on variables like experience or age. The older a person gets, the more health complications they may face. Different thoughts and opinions may arise from various individuals, but the consensus is that operating health insurance based on age would be more appropriate. The coverage may vary based on age, with lesser coverage for younger individuals and more coverage for older ones.

Contributory Health Insurance Scheme

However, it is suggested to make this a contributory scheme from the beginning, with 50% of the premium borne by the employees and 50% by the organization. This way, it will be truly valued by the employees, as anything given for free may not be appreciated. It is advisable to make it an individual responsibility so that each person takes out a health insurance policy and then gets reimbursed 50% of the coverage limits specified in a Standard Operating Procedure or policy created by the organization. This approach will be beneficial in the long run.

Thank you.

Thank you, Dr. Sivakumar, for your kind words and valuable insight. I agree with your assessment. However, can you please elaborate on this: "Kindly make it an individual responsibility so that one will take a health insurance policy and then get the premium reimbursed at 50% (of the coverage limits specified in an SOP or policy created by the organization) from the organization, etc. This will go for the long run."

Are you suggesting that the school reimburse 50% of the premium of an already existing policy and not issue a brand new insurance from the school's side?

Dear Colleague,

The idea suggested is to have an SOP or a policy in place. It may be a contributory system where both the school and employees jointly take ownership of employee wellbeing.

Option A: Existing Health Insurance Policy

The SOP/Policy may address that the existing health insurance policy or any new policy that might be taken with prior approval of the school management, then 50% of the expenses of the insurance premium may be reimbursed, subject to a maximum of ........XYZ.

Option B: Brand New Policy

You can also go with a brand new policy for the employees where you will have benefits of corporate discounts/relaxations possible, and the premium at 50% will be borne by the school, and the remaining 50% premium cost will be recoverable from employees. This will create joint ownership and will be sustainable in the long run.

Going for option A or B is purely your prerogative in consultation with school management and as per your own wisdom. What is mentioned is only a suggestion.

The key point is not to provide a "free system" (full cost of premium by management) which may affect the system in the long run, as we have experienced in many past organizations. You may also provide helplines for any assistance for medical help and others to the employees, and all coordination should be by the employees directly with the insurance company and so on.

If this is implemented for only part of the employees based on experience as an incentive or reward, then it may lead to grievances from other teaching or non-teaching staff in the short/mid-run, and the good move will face challenges.

Hope this clarifies.

You have two main options.

Group Mediclaim Policy

The first option is to take a group mediclaim policy, which is cheaper. However, the policy is applicable only for those who are working in your school and loses effect once they leave. Some organizations extend the coverage after retirement on superannuation.

Individual Policy Reimbursement

The other option is to let each person take their own policy and reimburse the full or part of the amount of the premium. That way, they get to keep the policy if they leave, which is important for many people as few employees today look for permanent employment until retirement. However, your cost and administrative efforts will be higher.

Coverage Decisions

How much coverage to give, and whether it will be to all or only seniors, is a decision that your management needs to make. It makes sense to cover all the employees as they are working for you, and therefore, you want them to benefit.