Reasons to choose individual health insurance over group health insurance?


5 min read

Why do you think you should buy Individual Health Insurance if you already are covered under a Group Health Plan? Let’s find out in this post!

People who are protected under a corporate or group health plan offered by their employers often get confused if they should buy an individual health policy. In fact, the confusion is quite normal since you are already getting certain benefits under your company health plans, which you may not receive under personal health policies. Also, you would think that if you and your family members are already receiving medical benefits from one cover, why should you increase expenses to buy another cover?

Let us discuss the benefits and disadvantages of getting a personal health plan on top of your group health insurance in this post to help you clear some confusion and support you on making a good decision.

What are the advantages of a group health insurance?

What Group Health Policy is All About??

A group health policy or a corporate health policy is a benefit offered by your organization that you work with to cover you and your family under a group health insurance.  Under this coverage, you get compensated for the expenses incurred on your medical costs during the tenure of your service with the organization. In terms of features, corporate plans have almost similar features like that of a personal health plan. Moreover, group health plans have some added benefits that you may not get under individual plans.

Some such advantages of group health insurance for employees are:

  1. You as an employee do not need to pay any premium –   Under group health insurance plans the employee is not required to pay any premium as it is paid by the organization where the person works. Hence, it comes almost free for you.
  2. The policy covers you as well as your family – Along with covering the employee, group health insurance policy also covers your spouse and children in most cases. In some plans, they also include your dependent parents.
  3. There is no waiting period under group plans – Most group plans also have the option of availing no waiting period. In fact, the waiting period for hospitalization is waived off under group mediclaims and thus you can enjoy the benefits of your health cover from the first day itself
  4. You don’t need medical check-up before enrolling in the policy – Under group plans, you are not required to take any medical tests before enrolling in the insurance plan
  5. The Group Plan covers pre-existing diseases – The best thing about group health plans is that they normally allow coverage for pre-existing illnesses from day 1, which is indeed a huge gain

All the above reasons are strong enough to argue that if you have a corporate health insurance you may not buy an additional individual health policy. So, when you are getting so much benefit from your health plan, why do you think it is not enough for your medical needs. Or why relying on your group plan solely is not a good idea. Let’s find out!

Why not to Rely Only on Corporate Health Policy?

Despite the fact that the corporate plan has so many benefits. However, relying solely on a group plan is not regarded as a smart option. And there are certain reasons to prove that, such as:

  1. Every job doesn’t guarantee a health cover –  Yes, you cannot assume that every organization that you would work in the future would offer health insurance benefits, especially if you are working in the private sector. As per reports, more than 50% of private companies don’t offer health insurance facilities to employees. So, in such a scenario, you may have to face financial stress in case you meet with an emergency health situation.
  2. Employers can amend coverage amounts and reduce it anytime – Well, if your organization goes through a financial crisis due to any reason, it may lower the sum assured of your insurance coverage or might exclude your family members from the plan. Further, they can ask the employee to co-pay a portion of the premium. All such things will shrink the policy coverage.
  3. Corporate coverage may not be sufficient – In most cases, group health plans allow a coverage of not more than INR 2 – 3 lakh. This is not sufficient in the present situation of such expensive medical treatments and rising inflation. And the coverage offered under your corporate health plan is not at par with the income you are earning. Hence, you can use individual health insurance plans to bridge the gap between your medical insurance needs and the coverage you already have.
  4. You can’t have coverage once you are retired – You cannot expect your corporate health insurance plan to last throughout life. It will not work when you are retired from your service. And if you plan to buy a health policy during the time of your retirement, it will not be easy and will be very costly as well.  Moreover, you will have to go through a waiting period and other clauses like pre-existing illnesses and exclusions etc.

Read More: Group vs Individual Health Insurance Policy- How to Find the One that Fits Your Needs

What Options Do You Have And What Can You Do?

The best strategy,  which is applied by most employed people covered under corporate health plans is to have both corporate as well as individual health insurance plans. This allows them to enjoy an extra cushion in times of medical emergencies when they need extra coverage beyond the limit of their corporate plan. Further, it allows benefits like tax deductions, lifelong renewability, no claim bonus and so on.

Read More: Health Insurance Plans for Individuals above 70 years in India

To Conclude 

As discussed above, you now know about the pros and cons of group health insurance vs. individual health insurance. Corporate plans have many benefits, however, they have certain limitations as well. So, looking at the entire scenario, it is better to have an individual health insurance policy along with your  corporate plan.  This way, you can make sure that your family and you stay protected from health emergencies all the time.

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.


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Sep 16, 2022
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PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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