With an estimated 12 million youth joining the workforce in India each year, organisations – including early-stage startups and small and medium-sized businesses – are offering comprehensive benefits to their employees. One of these is group health insurance for employees and their immediate families, usually parents, spouses and children.
Startups and SMBs, who are hiring a large number of millennials and Gen-Zs every year, have realised the need to go beyond conventional benefits to improve employee engagement and satisfaction. With the pandemic bringing health and wellness into sharp focus, HR leaders are re-evaluating their policies to include health insurance and provide employees with a greater degree of financial stability and work-life balance.
No doubt, group health insurance — whether it is a new employee benefit or expansion of an existing cover — comes at a considerable cost to these companies. But the positives outweigh the negatives. For instance, by providing health insurance, companies are boosting the morale of their employees, improving productivity, attracting and retaining talent, especially among the millennials and Gen-Zs, and creating a sense of loyalty.
Many early-stage startups and SMBs are collaborating with the more tech-savvy insurtech companies for employee group health insurance, including the management of health consultations and wellness plans. This leaves the companies free to do business. Insurtechs are also customising health policies based on the needs of the employees.
I have outlined below why group health insurance is a win-win for early-stage startups and small and medium-sized businesses, and their employees.
By offering health insurance, especially in these uncertain times, companies are sending employees a strong message: You come first. We care about you. It goes a long way in easing worries about money matters and mitigating the financial risks associated with severe chronic health conditions related to heart and diabetes or even surgery. Or Covid-19 itself. This in turn allows employees to focus on their jobs, their families, and other aspects of their lives.
Employee retention is one of the biggest advantages of employer-sponsored group health insurance. As I said above, knowing that their unexpected medical expenses have been taken care of motivates employees to improve their performance, participate in events, training and mentorship programmes, achieve their goals, and remain with the company for a long time. In that sense, health insurance as a benefit is good for business too.
Cost saving for companies
Group health insurance helps save costs as the employee premiums are lower than in individual health plans with similar benefits. This is because the risk is spread across a larger pool of insured individuals. As a result, employers can afford to provide comprehensive health insurance to their employees. For example, an employee can avail cashless hospitalisation wherein the employer’s insurance company settles medical bills directly with the hospital. The employee health benefit also covers pre- and post-hospitalisation expenses for a period of time. Besides, group health insurance plans cover maternity-related expenses and specific critical illnesses over and above the hospitalisation costs. It also covers pre-existing diseases from the day an employee joins the organisation.
Group health insurance gives employers the flexibility to customise health plans depending on their budgets and the benefits they wish to offer their employees. For example, employers can widen the cover to include doctor’s consultation fees, treatment for Covid-19 and mental illness OPD. Benefits in keeping with the current times, such as LGBTQ and IVF treatment cover, can also be customised as per the requirements of the companies. Employers can run surveys to learn about the health risks or predisposed illnesses among their employees, and choose plans accordingly.
Thinking Health from Day 1
One of the most important learnings from the pandemic is that many employers are now prioritising ‘health-first’ for their employees and incorporating it in their HR policies. Going forward, this will be a key criteria for hiring and retaining good talent, and will act as a catalyst for the growth of startups. Besides physical wellbeing, organisations should also care for the mental and emotional wellness of employees. Present-day group health insurance plans provide a complete wellness package, including periodic health and telehealth consultations for the entire staff.
In conclusion, early-stage startups and small and medium-sized businesses account for a substantial share of the workforce. With Covid-19 still in our midst, it makes moral and business sense for these companies to offer group health insurance to their employees, and ensure their mental and emotional well-being both in the workplace and outside.
Views expressed in this article are the personal opinion of Abhishek Poddar, Co-Founder and CEO, Plum – https://www.plumhq.com/