WHAT IS EMPLOYER EMPLOYEE INSURANCE

Empowering your workforce has led to overall business growth in recent times. Additionally, employer-employee insurance can shrink the churn rate at your company. 

Today, we are going to appreciate the concept of employee insurance. Let’s comprehend how it favors both the employees and employers.

 

What is Employee Insurance?

Employee insurance is a special insurance type provided by employers to their employees. 

Switching company jobs constantly has become a trend these days. Even after working in the same company for many years, many employees do not get the facilities that they require. Consequently, they prefer to leave your organization and join others. 

The situation becomes unwelcome when skillful workers leave the company. Then, encouraging them to continue to serve your enterprise meets the goal. 

Employee insurance is a way to stop them from resigning from their job and leaving your company. Providing them with financial security makes them feel safe and work with more dedication as well. 

Under this facility, employees get health insurance for illness or any hospitalization. Plus, their families can receive financial security after their demise. 

All together, the employee's insurance attracts candidates and retains staff at your company. It automatically contributes to expanding business.

 

What is an Employer-Employee Insurance Scheme?

An employer-employee insurance scheme is a plan of action taken by employers. Employees need financial benefits in emergency situations that arise in their lives. It's not that they cannot purchase insurance policies on their own. But for this, they need to bear the financial burden by managing day-to-day expenses. 

To reduce this stress, employers purchase insurance policies for their employees. The employers pay the premiums, and employees are the beneficiaries. In this way, employers provide monetary compensation to their hired hands in tough times.

 

Benefits of Employer-Employee Insurance Scheme 

Employer-Employee Insurance Scheme proves beneficial for both the employees and employers too. Here are the prime benefits of the Employee Insurance Scheme.

●      The scheme offers life insurance, group health insurance, and many other coverage types. All the coverage benefits help employees to overcome their stress.  

●      Paying for an Employer-Employee Insurance Scheme helps you retain your existing staff. Understanding about the scheme boosts their willingness to continue to work at you.

●      Employees are like family members. Helping them in their ups and downs is your responsibility. Financial help satisfying the tough conditions makes one feel untroubled. Buying insurance for your employers is a way to give a helping hand to them.

●      The decision to opt for such a scheme lets you recruit talented employees. Keeping them engaged for a longer time becomes easy for you.

●      You can prevent tax deductions by showing the premium as a business expense. Many other benefits you can get by purchasing employer-employee insurance.

 

Benefits to Employer, Benefits to Employee

Considering the fact that insurance is a financial shelter for everyone. Employees are the prime beneficiaries under the Employee Employer insurance scheme. Let’s see the benefits they get from this scheme.

Benefits to Employee

●      When workers perform well, employers appreciate their efforts by presenting them with a reward. It boosts them to maintain their consistent performance. Providing health insurance to employees also acts the same.

●      The group health insurance provided by the employer covers the employee’s medical expenses. The insurance helps financially to employees' dependents too. It means that if an employee passes away for any reason, their families shouldn't suffer. 

●      With the help of the policy, employees may receive the following risk coverage Natural Death Cover, Accident Death Cover, and Disability cover.

●      The policy is also like a pension provision for employees. If employees decide to retire after a certain age, they get a huge fund as security. So that they can plan their finances to live life independently. 

●      Suppose, the employee faces an unpleasant situation like an accident, disability, or death. Then, their nominees can receive the scheme benefits.  

Now let’s find out how insurance proves beneficial for you as an employer.

 

Benefits to Employer

Employers who invest in employee-employer insurance must know its benefits- 

●      Policy assists you to maintain good relations with your staff and retain them for a longer time. Knowing that they are getting financial security, they can work with more integrity. Talented and experienced employees contribute more to business than fresher. Further, introducing such schemes promotes your company. Owing to this, proficient employees opt to join your organization and serve the best. 

●      The insurance premium paid by you as an employer can be claimed as business expenses. Apart from the tax benefit, there are several other benefits employers can get under this scheme.

 

Eligibility for Employer Employee Insurance

Granting health insurance to workers is one of the standard employment practices.

From small-scale to large enterprises, any firm can purchase employee insurance.

Following are the parameters defining eligibility criteria for Employer Employee Insurance. 

●      Any business, or any trust/company whether its Pvt. Ltd. or public ltd. are eligible to buy the policy for their employees. 

●      Employees have a legally signed agreement with the company to get the insurance benefits from the employer. For example, a salary slip shows that the employee is serving the employer. 

●      Employers are allowed to complete the purchase of insurance for their NRI employees. But they must have a registered office in India

All general parameters are the eligibility criteria for an employee-employer insurance scheme.

 

How Does Employee Insurance Work?

Organizations looking for employee health coverage options ensure affordable medical facilities. 

- Selection of Insurance Plan

Employers connect to insurance providers and select an ideal insurance plan from them. Generally, employers shop for a group insurance policy. It covers employees' health, life, and disability insurance. 

- Employee Registration

Then, employers ask to register themselves to get the benefits. Employees are expected to fill out the enrollment form providing their complete information. They need to mention details of their family members too. 

- Pay Premiums

Employers pay the premiums on behalf of its employees for their insurance coverage. Sometimes, employees are asked to pay some portion of the premium.

- Take an Advantage

Employees can use the policy in emergencies like medical care. They can utilize the coverage while undergoing dental or vision-related treatment. When employees claim coverage, insurance providers process it and release the claim amount. 

- Policy Renewal

When the coverage period ends, typically after one year, employers can renew the plan for another term. Employers can switch the insurance plan during the renewal. Additionally, employers can customize the coverage by adding riders in health insurance.

 

Final Thoughts

Recruiting the right candidate for a job in your company is a challenging process. That is why it is important to retain the people you have found. Utilizing their experience and knowledge in your business lets you reach success. 

Plus, it’s your responsibility to ensure that they don't feel insecure and connect with you for years and years. Providing them with the right facilities and financial security for the future is the ideal solution.

Introducing employee employer insurance schemes can stop them from discontinuing work at you. Their unending contribution to the business undoubtedly increases your professional growth as well.

 

FAQs

1. Is Employee Insurance mandatory?

Yes, employee's insurance is obligatory in India. After the Covid pandemic, the Indian government has made it compulsory in all types of organizations. 

2. Does the Employer-Employee Insurance Scheme cover all employees?

Yes, the Employer-Employee Insurance Scheme covers all employees. Any company can opt to pay the premiums for any number of employees. 

3. Can an employee continue the insurance policy after leaving the company?

Yes, employees can continue their health insurance coverage even after resigning the job. They just need to convert their group policy into an individual health insurance plan. 

4. Is employer-employee insurance different from group health insurance?

No, employer-employee insurance is not different from group health insurance. It's just a kind of health insurance that employers provide for their employees. 

5. Does employee insurance cover family members?

Yes, employee insurance is referred to as group insurance. It covers family members like children, spouses, and dependent parents. 

6. What factors should an employer consider before choosing an insurance plan?

Employers must consider the cost of premium and network hospitals within the plan.  Claim settlement time and the reputation of the insurer must be considered. Considering the employee's needs also helps to choose an insurance plan.