In today’s world, health insurance is essential. Whether you’re running a startup or a well-established business, offering group medical insurance to your employees can be a game-changer. It helps attract top talent, ensures employee well-being and offers tax benefits. However, how many employees do you need to qualify for group insurance? Let’s find out.
What is group medical insurance?
Group medical insurance is a health insurance policy that provides coverage to a group of people, typically employees of a company. It is more affordable than individual health plans and offers comprehensive benefits such as hospitalisation expenses, OPD fees, maternity coverage, and wellness programmes.
Why offer group medical insurance?
Here’s why businesses in India should opt for group insurance:
- Employee retention – Employees prefer companies that offer health benefits.
- Cost-effective – Cheaper than individual policies.
- Tax benefits – Employers can avail of tax deductions under Section 80D of the Income Tax Act 1961.
- Better healthcare access – Covers pre-existing diseases from day one.
- Enhanced productivity – Healthy employees mean fewer sick days and better performance at work.
- Competitive advantage – Offering group medical insurance helps attract top talents in the market.
- Legal compliance – Many organisations are now required to offer some form of health insurance to their employees under labour laws.
- Financial security – Employees and their families are safeguarded against unexpected medical expenses.
Minimum employees required for group health insurance
In India, businesses need at least 7 employees to avail of group medical insurance. However, some insurers may offer coverage to groups as small as 5 members if they include employees and their family members.
Here’s how the number of employees impacts eligibility:
| Number of employees | Eligibility for group insurance |
|---|---|
| Less than 5 | Not eligible |
| 5-6 | Some insurers may allow |
| 7+ | Eligible for most insurers |
Who can be covered?
Employers can extend the group medical insurance coverage to:
- Full-time employees
- Part-time employees (depending on the insurer)
- Interns (if included in company policies)
- Family members (spouse, children, parents)
- Contractual employees (if specified in the company’s terms and conditions)
Types of businesses that can get group insurance
Here is a list of business types that qualify for group health insurance:
- Startups & SMEs – If you have a growing team, investing in group medical insurance makes sense.
- Corporates – Larger businesses often opt for comprehensive plans with added benefits.
- Partnership firms & NGOs – Some insurers offer policies even to non-corporate entities.
- Freelancers & gig workers – Some insurers are extending group insurance to freelancer groups.
- Retail businesses – Shops and retail outlets with multiple employees can also avail of group medical insurance to ensure workplace security.
- Manufacturing units – Factories and plants often require health insurance due to the risk involved in operations.
- Educational institutions – Schools and colleges offering health insurance can ensure a healthy working environment for the staff.
How to apply for group medical insurance?
Follow the below simple steps to apply for group medical insurance:
Step 1: Research & compare plans
Check multiple insurers and compare benefits, exclusions and premiums.
Step 2: Get a quote
Contact the insurance provider or use online tools to get a premium estimate.
Step 3: Provide employee details
Submit employee details, including age, salary and family information (if applicable).
Step 4: Policy issuance
Once the documents are verified, the policy will be issued and employees can access benefits.
Conclusion
If you have a business with at least 7 employees, investing in group medical insurance is a smart move. It ensures workers’ well-being, provides financial security and enhances job satisfaction. Offering health benefits not only helps in retaining employees but also boosts productivity and workplace morale.
With healthcare costs rising, having a comprehensive plan in place safeguards both employees and the organisation. With so many advantages there’s no reason to skip group medical insurance. Whether you’re a small business or a large corporation securing the health of your workforce is a step towards long-term success.