How Corporate India Is Easing Health Insurance Woes for Ageing Parents

With corporate medical coverage, the policy covers your parents without any pre-health screening, regardless of age or existing health conditions.

Corporate India is addressing health insurance challenges for elderly parents through group health coverage. This policy, provided by employers, covers hospitalisation, pre-existing conditions, and sometimes even maternity without requiring medical tests. It supports ageing parents by offering immediate coverage for pre-existing diseases and eliminating age restrictions. Although it offers low premiums and wellness benefits, such as access to specialists and health check-ups, it has drawbacks, including capped coverage, an employment-based nature, and non-portability. It is advised to complement it with individual insurance for comprehensive coverage.

Regardless of how well you earn, if you have senior citizen parents battling chronic illness, a series of hospitalisations or a major surgery can drain your savings. If you turn to buy health cover for them, there might be a possibility that the premium doesn't fit your budget. This is where the role of your employer kicks in by covering parents under a group health insurance.

What is Group Health Cover?

A group health plan is a mediclaim policy provided by an employer or organisation to cover its employees or members under a single policy. Instead of purchasing individual plans, you are included in a collective policy that covers hospitalisation, day-care procedures, pre-existing conditions, and sometimes even maternity.

The premium is calculated based on the overall risk of the group, not just your health. The insurer assesses the number of members, their age group, health history, and the sum insured applied for by the company. Since the risk is shared, the premium per person is significantly lower than that of individual policies.

How Does Group Health Coverage Support Ageing Parents?

Nowadays, most corporate health plans not only cover the spouses and dependent children of their employees but also their parents, with a few even covering in-laws. Here are some benefits of this policy for parents.

• No Medical Tests

When you wish to purchase health insurance for your parents, especially those over 60, the insurer requires them to undergo a series of medical tests. They need to undergo ECG, liver and kidney function tests, lipid profile, and a few more tests. All these not only add to your costs but also, if your parents are diagnosed with any ailment, the insurer either rejects the coverage or, if approved, charges a loading fee over and above the premium amount.

With corporate medical coverage, the policy covers your parents without any pre-health screening, regardless of age or existing health conditions.

• Covers Pre-Existing Diseases

In an individual or a family floater health plan, the insurer imposes a waiting period for pre-existing diseases. For example, if one of your parents is dealing with diabetes and any health complications arise due to it, such as kidney damage requiring prolonged hospitalisation, the insurer will not accept the claim if the waiting period, ranging from 24 to 48 months, has not yet been completed.

But this won't be the case with group health insurance. No matter whether your parents are dealing with diabetes, hypertension, arthritis, or any other medical condition, the policy will cover such diseases from day one.

• No Age-Based Restrictions

When it comes to individual or floater plans, most health insurers put an age cap for new policyholders. This can be somewhere between 75 to 80 years. After that, getting a fresh individual health plan becomes nearly impossible. But in group insurance, there is no such age restriction. This provision is useful if your parents never had insurance earlier or their individual policy lapsed. You can include them under your employer's group plan, irrespective of their age.

• Low Premium

When you apply for an individual plan to cover your senior citizen parents, even if they don't have any pre-existing conditions, the premium may start at around ₹35,000 for a sum insured of ₹5 lakh. Not only that, once the policy is issued, you will find numerous exclusions and a high copay, which practically minimises the policy's effectiveness during a medical crisis.

However, in a group policy, the premium remains reasonable due to the risk-sharing model. Since the pool includes young and healthy members (the employees), the costs are averaged out. This keeps the premium affordable, even for elderly parents, with a nominal top-up of ₹4,000 to ₹7,000.

• Wellness Benefits

Group health insurance policies these days offer value-added services such as second medical opinions, teleconsultations, and mental health support. They are particularly helpful for your ageing parents who avoid medical attention due to financial worries.

The easy access to specialists and periodic health check-ups built into the plan not only improves convenience but also ensures that by becoming aware of any underlying health issues before they become chronic.

• No Premium Hike

In individual policies, if your parent files a claim during the year, you will probably see a premium hike or reduced benefits at renewal. In contrast, group policies don't penalise claim history. Premiums are based on the overall risk of the group, not on individual usage. This gives peace of mind because you don’t have to worry about future affordability every time you use the cover for your parents.

• Cashless Hospital Network

Group insurance providers have tie-ups with a large number of hospitals under a cashless network. The claim process is much faster and more flexible than retail plans. Since insurers already have long-standing corporate relations, pre-authorisations for surgeries or treatments get approved quickly. This helps elderly parents who might need immediate admission due to sudden health deterioration.

Why Group Health Cover Is Not Always Enough?

There is no doubt that group cashless health insurance offers multiple benefits to ageing parents, but it is not without downsides, which are discussed below.

• The sum insured under group cover is often capped at ₹2–5 lakhs. This may not be enough to cover hospitalisation, surgeries, or post-hospital care for your ageing parents.
• The group cover is tied to your job. If you resign, retire, or are laid off, your parents lose the coverage instantly.
• Group policies are renewed annually at the employer's discretion. You have no control over future premium hikes, coverage downgrades, or the possibility of the policy being discontinued altogether.
• These policies are designed for a group and not tailored to your parents’ medical needs.
• You cannot port group health policies to an individual plan. So, if you rely only on group cover, you will find it tough to shift your parents to a standalone policy later without fresh underwriting.

Conclusion

While corporate group health cover provides valuable benefits, such as low premiums, coverage for pre-existing conditions, and no age restrictions, it also comes with limitations, including a capped sum insured, dependence on employment status, and a lack of portability to individual plans. If possible, it is recommended to use group health coverage as a supplement to individual medical insurance for your senior citizen parents rather than as a substitute.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.