Employee Benefit Series – Group Medical Insurance

Employers can offer group medical insurance to eligible staff to help cover medical expenses resulting from hospitalisation and/or out-patient visits as an employee benefit to help attract and retain talents.  Some packaged plans allow companies to set up with as few as 2-3 employees.

Coverage

Employers can choose either standard package or custom tailor-made plans that offer in patient and hospitalisation coverage according to their own needs.  Generally companies with more than 10 staff have the option to tailor-made the benefit schedule.

Employers may opt to offer optional outpatient, dental, maternity coverage.

Some plans will offer eligibles employee an option to transfer to a personal medical plan after employment termination to extend coverage and avoid a protection gap.

Pre-existing conditions

Pre-existing conditions will not be covered unless an insured person has been insured under the policy continuously for a minimum of 12 months.  Pre-existing conditions however may be exempted for companies covered by another group medical insurance plan prior to switching to a new plan.

Health Declaration

New members are usually required to fill out a health declaration prior to enrolment.  For a company with 6 or more staff, the health declaration will generally be waived, though pre-existing conditions for new join members will still not be covered until after a 12-month enrollment.

Premium                                     

The premium of standard package plan is usually determined by pool-rating and premium increases are more stable, as the premium will only be affected by medical inflation and not by claims experience. 

The premium of tailor-made plan is impacted by claim ratios and can be unpredictable.

Summary

Group medical insurance can act one of many means to help attract and retain talents in a tight labour market.  Employees can use it as a top-up or cover the deductible of their own personal medical insurance.

Employers can select standard or tailor-made plans according to own budget considerations annually.

Please contact us if you are interested in learning more about group medical plan for your company.

Last Update: 7th March 2023