Both individual health insurance and group health insurance provides a similar description, but they vary in terms of cost and customisation. People often buy various kind of medical insurance policies. You can compare both the health insurance policies and choose one which is best and provides you with useful information.
Definition of types of health insurance
Group health insurance – It is usually bought by an organisation for the benefit of its employees. The organisation does it by selecting a self-insured plan or pre-planned insurance policy from an insurance company. It can also be bought as a family insurance policy.
Individual health insurance – An individual buys this insurance for self or for a group of people which includes their family. But as the name suggests individual health insurance, it covers only a single person.
Terms on which individual and group health insurance differs
Cost – When compared both health insurances we can see that group health insurance costs you less, or you can say it can be availed for no cost for the employees. It costs you less because you buy it in bulk and employee do not have to pay any extra fee for it. And in addition, if you choose a premium package than the fee get deducted from the salary. And this is the reason why some people don’t buy individual health insurance.
No-Claim Bonus – If in group health insurance you don’t make a claim, then as an individual you don’t get any benefit throughout the tenure. And whereas in individual health insurance if you don’t make a claim you are competent for No-Claim Bonus which results as a reward for being healthy.
Applicability – For group health insurance an employee is offered the group plans as long as he pays the premium. But in an individual health insurance plan, it is applicable at all the time. The important thing to note here is, being an employee if you wish to resign you can convert your health insurance into individual health insurance.
These were some of the terms on the basis of which group health insurance and individual health insurance differs. People often buy medical insurance also, so that they can make a claim if they have any medical health problem. Now let’s see which health insurance is more appropriate to choose.
Which plan should you choose?
As we saw above, the group health insurance costs you less but individual health insurance is also a need for a person. Group insurance policy lasts until you resign as an employee whereas individual health insurance lasts for a lifetime. Or, if it is a family insurance policy, it may become void at the demise of one person. An individual insurance policy covers the illness and diseases which you want to cover on your family’s and your medical history. By studying all these aspects and differences of both health insurance, we come up with the result that individual health insurance is more appropriate even if your employer provides group insurance to you.