ESI Benifits & Employer Health Insurance - if any employee's salary becomes more than 21000

Dear Seniors, We have provided health insurance to our employees whose salary is more than 21000, and their employee state insurance is not deducted if any employee's salary becomes more than 21000 in the month of April or October we stop deducting their ESI and provide them Health Insurance and I want to know that when should we start providing health insurance to our employees from April /October or when their benefit period expires because as far as I know that employee is eligible for all ESI benefits till next six months if ESI deduction is stopped in April or October due to salary exceeding in April/October.

Kindly Guide Me.
Thank You

Hello Gajinder,
As you have already mentioned each and everything correctly.
You can apply for Health Insurance anytime after the increase of salary wages of any employee it is not necessary that you can apply only after April or October.

Hi,

Even you consider and recommend Mediclaim insurance (health insurance) to all employees including employees covered under ESI. Having Mediclaim in place all can afford to take quality treatment at private hospitals.

With regard to continuation ESI contribution, in case of hike in salary in the middle of contribution period (April-Sept & Oct - Mar) which results in hike in gross salary > Rs.21000/- then till the end of contribution period either Sep end or March end contribution to be continued.

It is true that an employee becoming out of ESI coverage will continue to get medical assistance till the benefit period ends. But this does not mean that the employee will remain as an insured employee once he becomes out of ESI scheme. As such if some accident occurs, he will not get the benefit because the accident benefit is available only to an "insured employee" while on duty and since he has ceased to be an insured employee, he will not get the benefits, ie, disablement benefits etc. Therefore, it is always advisable to cover such employees who come out of ESI immediately after the contribution period, ie, in April or October itself.

I second the view of Mr. VM Lakshminarayanan, very clear that even though the employee is out of the bracket i.e., 21000 during the contribution period, the subscription will continue till Mar or Sep and from Apr or Oct the subscription can be discontinued. The insurance can be taken from the date of his getting paid over 21000, for him to be covered under any contingency.