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Corporate Medical Insurance

Otherwise known as ‘Group Health Coverage,’ corporate medical insurance is designed to benefit your employees. Providing them with cover, in the event of prolonged sickness, to support their treatment and hopefully get them back to work as soon as possible.

This post will run through some of the features, benefits, and pitfalls of corporate medical insurance.

What is Corporate Medical Insurance?

This type of medical insurance is bought by an employer for the benefit of his employees. There are packages to suit all companies, from small businesses to global corporations. These schemes are useful because they incentivise workers and reduce the costs of employee absenteeism.

Grouping lots of employees together, under one policy, also spreads the risk across many people. This means that the insurance premiums can be more affordable for your company.

Why Should Employers Consider Corporate Medical Insurance?

• This type of cover benefits employers, as its inclusion in an employee benefits package can be very motivating for staff. Encouraging company loyalty, in some cases.
• The plans can be tailored to suit the different job roles within your workforce. For instance, the level of cover a receptionist would need would be very different from that of a delivery driver working for the same company.
• Private medical insurance holders can bypass some services of the NHS, often resulting in shorter waiting times and ultimately a speedier recovery, in some cases.
• You can find plans that cover all sorts of care like dental, optical, and psychiatric treatment.

What Types of Corporate Medical Insurance are Available?

There are many levels and variations of cover available for corporate medical insurance. Basic plans will cover only things like inpatient treatments. Then there are mid-range plans, where something like 50% of an employee’s salary can be covered. There is also the option for the employee to extend cover, all the way up to full comprehensive insurance. Features of comprehensive plan may include inpatient and outpatient treatments, overseas cover, some will even offer GP and home nursing services.

Let’s Look at a Corporate Health Insurance Example:

Charles owns a plastics company and has 50 employees. 10 of his staff work in the factory, producing the goods to sell. 10 people handle installations and deliveries. 6 of his personnel work in sales and travel extensively and the remaining staff work in the office. Cecil is looking for a company-wide medical insurance package that can handle multiple levels of cover.

What are the Benefits of Corporate Health Insurance?

• Family Benefits- Some companies will also provide some medical cover for their employees’ family members. This is because sickness in the family also causes employee absenteeism. This protection gives employers the chance to offer support.
• Flexible Cover – As an employer, you can tailor your plans to suit your employees’ job roles, as well as give individuals the opportunity to ‘top-up’ their insurance. Paying higher premiums in exchange for more cover. For example, you could start with 50% of salaries covered under your plan, leaving the employee the opportunity to bring this up to 75%. This benefits not only companies, but individuals too. If you are seeking individualised insurance, you can use your existing work cover and pay, most likely, cheaper premiums for just the ‘extras’ you need.
• Excess – As the employer, you can set the excess amount for your employee’s claims. This may discourage staff from making small claims on the insurance. Including an excess option in your group scheme will also help to keep your premium costs to a minimum.
• Six Week Wait – You can also include a six week wait on your plan. This is where the employee uses NHS services in the first instance, and if they have to wait longer than six weeks, they can then use the private cover option.
• Psychiatric Treatment- With stress being the cause of many illnesses, providing cover in this arena can benefit your working environment.  
• Underwriting Available – With the option of having your policies underwritten, you can offer insurance to all of your employees, but only minus cover for the pre-existing conditions. Any exclusions will, of course, be made explicit to the employees it concerns. But doing this will give them the option to buy their own individualised cover and still benefit from the employer plan you are providing.
• Medical Background Disregarded- You can also bypass the employee health checks and opt for a plan where no medical history is taken into account. However, premium payments for this will more than likely be higher than underwritten plans, because they carry increased risk.
• Claim Back Tax – If you pay towards your employees’ premiums, you can claim the tax back.
• Medical Health Checks – Depending on the service provider, you can conduct annual health screenings for your employees. Individuals can be examined by a medical professional, who will then be able to point out areas of concern, i.e. health problems that could lead to future employee absenteeism.

What are the Pitfalls of Group Health Cover?

• Individual Premiums – Every premium calculation, for every employee, will be treated on an individual basis. This means that your employee’s age, gender, and other factors may affect what you pay for your group plan. Similarly, from an employee’s perspective, a fit and healthy person may have to pay the same towards their premiums every month as a less healthy colleague. It may be possible for individuals to pay less in premiums by just insuring their own medical needs instead.
• Administration – If you own quite a large company, the administration involved in overseeing the insurance plan may be considerable. It is possible that you would need to amend, top-up or change your policy in the future. This may involve paying fees to an account manager, who can organise your cover on your behalf.
• Cost – The costs for setting up insurance across your entire company will be significant.
• Individualised Plans – If your employer health package offers some protection, it may be that your employees will need to find their own plans to build cover for all eventualities. You may need to take some time to explain to your staff, what exactly they will be insured for and how it works. There may be times of confusion, where an employee is unsure of their entitlements. So, you should make sure that HR is fully versed on the insurance benefits for employees.
• Legal Fees – It is possible that there may be some compliance and legal costs involved in maintaining a corporate medical insurance plan. Mistakes in insurance plans may bring lawsuits or fines from regulators.

What are the Alternatives to Corporate Medical Insurance?

• Individual Cover – If you are an employee with some medical insurance through an employer, you may have some restrictions on what you are covered for. If you are looking to ‘top-up’ your cover, you may want to look at individualised Critical Illness Insurance or Income Protection Insurance.

Group Medical Insurance can encourage employee loyalty and attract the best candidates to your company. To find out how you can best insure your workforce with their medical needs, get in touch with a specialist group medical insurance broker. They can offer you free advice and a no-obligation quote.