It is not mandatory for an IT company to provide medical insurance to its employees. However, if the number of employees crosses the threshold limit for coverage of ESI, i.e., 10 in some states and 20 in other states, then employees whose monthly salary does not exceed Rs. 21,000 should be covered under the ESI schemes. For other employees, there is no legal requirement to provide insurance.
Employees Compensation Act
For certain employees such as drivers and security guards, the Employees Compensation Act applies, making it necessary to have a policy under the said Act for them. This insurance is intended to cover compensation for accidents resulting in disability or death during work. There is no obligation to provide medical benefit coverage to these employees.
Medical Insurance as Employee Welfare
Medical insurance is considered an employee welfare measure and can be implemented according to your policy. It can be made applicable only to confirmed employees.