It’s an acknowledged fact that hiring for a start-up is a challenge that every entrepreneur’s (especially first-time ones’) headache is centered around. Attracting a settled and performing individual to leave all behind and jump ship (more like jump ship to the boat) is hard enough.
Fortunately, there are means and instruments, such as group health insurance in which you can invest and provide a certain sense of security for your start-up.
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However, there are more than a few sticking points:
Premium Sharing-Now the next challenge is how to fund the program that will increase in cost every year.
The solution to that is that the program does not have to be entirely funded from the employer’s pocket; it can be partially funded by employees. There are no set limits to this cost that can be divided between the two.
Conflict with existing personal insurance: The disadvantage of a partially sponsored Health insurance program is that employees who have existing insurance coverage or are covered under the insurance of their parents usually have strong reservations about signing up for the program. In this case, the employer needs to highlight the benefits of the company’s health plan like lower premiums, higher coverage, lower waiting period for pre-existing diseases, and the like.
How much is enough? No two start-up journeys are the same, so this question has no standard answer. Based on capacity, average income, and bearing capacity of the employee as per their contribution, what can premium can be best offered? An average cover of 2 lac plus will be a good start for (self + spouse) or even self+ spouse + child. It’s not enough to cover parents in the plan (which also increases the premium).
Managing Y-O-Y escalation in premiums: Group insurance premiums divided into a small group can be untenable after one year, even if a small number of claims are made. To cope with this, insurance companies provide a number of restrictions and limitations, such as high co-pays, procedural limits, room rent limits, etc. These restrictions can seem unappetizing, but these serve the purpose of keeping the insurance claim low, hence the premium stable.
There are a few restrictions that are required to be understood before opting for group Mediclaim insurance as prescribed by the insurance governing body IRDA, such as-
One cannot form a group for the sole purpose of availing themselves of health insurance. It has to be a homogeneous group of people that are linked to each other as a group for other purposes or economic activity other than insurance.
