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Health Insurance

Which one Should you opt – for individual health insurance apart from employer insurance?

Most of us are offered an individual health insurance package by the employer at the time of joining the company. This type of offer is only applicable to individuals who are directly hired on the payroll. The premium for the same is deducted from the salary each month. So, should you opt for individual health insurance apart from employer insurance – many employees have this in mind because of the constant discussions that happen around this topic.

Which one Should you opt - for individual health insurance apart from employer insurance? 1

To know the best decision on choosing between employer insurance and individual health insurance, there are three main questions that you need to ask yourself:

  1. What are the features in company provided insurance? Understand the list of coverage benefits and the sum assured or coverage amount provided by the health insurance policy offered by the company.
  2. Is your family also covered in the company’s offered health insurance scheme?
  3. Is the health insurance provided by your employer, protecting you against all illnesses or is it covering only a few medical expenses?

Suppose your answer for any of the above questions is No. In that case, the health insurance coverage offered by your existing company is not sufficient. For the question should you opt for individual health insurance apart from employer insurance – the answer is a big YES.

For example, Mohan has been employed with a manufacturing company for the past three years. He has a company-issued health insurance policy, with a coverage of Rs 5 lakhs. Years passed by, and he did not use the insurance for any medical claims. But after six years, his father was diagnosed with critical renal failure. He had to undergo a kidney replantation that cost almost around Rs 10 to Rs 15 lakhs. Mohan was puzzled as his health insurance plan, provided by the company could cover treatment costs, only up to Rs 5 lakhs. He had no other option and had to arrange almost ten lakhs to save his father’s life.

Such unfortunate situations are widespread nowadays as we assume and convince ourselves that the company’s health insurance is enough. This brings us to the question of whether we can afford to miss out on having additional health insurance to secure both ourselves and our family?

To highlight more on should you opt for individual health insurance apart from employer insurance, consider reading the following important pointers for better understanding:

Not completely reliable or a guaranteed health protector tool: As the above example states, under unfortunate critical medical situations, the employer health insurance plan might not give full coverage. Also, when you lose your job in private establishments, health insurance will become void.

In today’s world, where the effect of a pandemic is looming, it is always better to have an individual health cover without depending too much on the employer.

For instance, let us consider a person working in the travel industry lost his/ her job since the company had to shut down their operations due to some natural calamity. Suddenly, an unexpected medical emergency pops up that was not imagined even in the wildest dreams. With no job, this person would not have access to utilise the company’s health insurance policy.

In such extreme situations, it becomes complicated to manage any unexpected medical expenses that might arise. Therefore, if you opt for individual health insurance apart from employer insurance, the answer would be a big yes as it is always good to have a secured backup.

Limited or no customisable options: There will be a fixed set of benefits that you might be getting which is the same for all the employees working in the company. Some employer-issued health policies do not provide health insurance coverage for parents or even for spouses and kids. Also, they wouldn’t update or give employees an option to customise their health insurance plan depending on their family’s health condition. Under these circumstances, you will not have any control over such health covers as it serves no benefit.

According to a recent survey conducted pan India, with a sample size of 3000 employees, about 59 percent of employees want health coverage on general check-up, which is not offered by most of the companies. Also, the entire maternity package expenses are offered by only 20 percent of the employers. Similarly, 31 percent of employees wanted diagnostic expenses to be covered, which less than 20 percent of the employers provided insurance.

The premium waiver option is also absent for employer health insurance as the charges are fixed here without flexibility. A premium waiver is availed when the aged parent expires, and the sum assured allocated can be moved on to add on to the other dependents increasing the overall sum assured. Thinking from this perspective also makes sense of why you should opt for individual health insurance apart from employer insurance.

No scope for tax deductions: You cannot claim tax benefits on the employer’s health insurance as you are not paying the periodic premiums. The corporates’ main reason to give insurance is to claim the company’s tax benefit, which is a form of cost optimisation.

None of the sections ranging from Section 80D, 80C or 10D is applicable for claiming tax benefits for an employer-issued health insurance policy. On the contrary, paying premiums for an individual health insurance cover makes you eligible to claim income tax benefits under various sections.

The above set of points makes it obvious to choose between individual health insurance and employer insurance. It is quite clear that the health insurance offered by the employer is not sufficient. The nation-wide lockdown due to covid19 pandemic has awakened many to realise how important health is and has also taught a good lesson for people on how important it is to invest in a proper individual health insurance plan.

To avoid last-minute financial crunch related to healthcare costs and secure your family’s future health, it’s advisable to avail an individual health insurance policy apart from the one that’s offered by your employee. Buying an individual insurance policy can be a tricky task, but don’t worry. Reach out to advisors at and they will help you buy the best policy for your need in no time.

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