What Is Group (Corporate) Health Insurance and What Are Its Benefits?

1. What Is Group Health Insurance?

Group health insurance is the most tangible way for an employer to tell staff “your health matters to me”. These plans, which start once a certain headcount is reached, usually offer lower prices and wider benefits than buying individually.

Who can benefit from group health insurance?

Employees who are part of the group, and — with an extra premium paid by the employer — their spouses and children. There is usually an age range for joining (0–64 at many insurers); in complementary group plans, employees must be covered by SGK. Foreign staff working with a work permit and SGK cover can also be included in the group.

From how many people can group health insurance be arranged?

The minimum number varies by insurer; in practice 10 or 20 people are usually required. Some insurers may have special packages for smaller businesses too; we will look at the options for your headcount together.

2. Benefits of Group Health Insurance

Group health insurance benefits both employees and employers.

What are the benefits for the employer?

• Quick application: you insure everyone under one policy instead of dealing with each employee separately.
• Flexible cover: you decide the budget, who pays the premium, who is covered and whether families are included.
• Employee loyalty: benefits are an important tool for keeping good staff and attracting new ones.
• Less lost working time: employees treated on time recover faster.
• Tax advantage: premiums paid by the company can be treated as an expense when calculating the corporate tax base.

What are the benefits for employees?

• They do not face large bills when treated at private hospitals; even a single day in hospital can wipe out savings.
• If the family is covered too, both they and their family are protected.
• If they have a problem using the insurance, the company’s HR department contacts the insurer.
• They feel valued, which increases loyalty and productivity.

How should you decide on the cover?

First clarify how much budget you can set aside, who will pay the premium, who will be covered and whether families will be included. For example, if your staff often see a doctor, a policy with outpatient cover may be better; if many of your employees are women, a plan with maternity cover may suit you.

3. Types and Covers of Group Health Insurance

Group health insurance can be designed as complementary, private or a mix of both. In terms of cover it differs little from individual health insurance; the real differences are flexibility and price.

What is complementary group health insurance?

With SGK support, it pays the extra fee for outpatient and inpatient treatment at private hospitals contracted with SGK. Being SGK-supported, it is cheaper than private health insurance. For how it works, see our complementary health insurance guide.

What are private and hybrid group health insurance?

Private group health insurance pays employees’ medical costs from illness and accidents at the insurer’s contracted hospitals, within the cover and limits set by the employer. In hybrid plans, private and complementary covers are in the same policy, and employees can choose covers according to their needs and budget.

What does inpatient cover include?

For treatment with a hospital stay, with or without surgery: operating theatre, doctor, intensive care, standard room, companion, medical supplies and medicine costs, and home care; as well as chemotherapy, radiotherapy, dialysis, physiotherapy and minor surgery. In short, for treatment requiring admission, hospital costs including room and meals are paid.

What are outpatient cover and the extras?

Outpatient cover includes doctor visits, lab tests, medicines, physiotherapy, X-rays and advanced diagnostics. Inpatient and outpatient covers can be limited or unlimited. Extras such as maternity, dental, eye care, psychological support, dietitian and emergency services can also be added.

4. Premium, Application and Cancellation

In group health insurance, how the premium is set and how the policy is managed differ from an individual policy.

Who pays the group health insurance premium?

It is the employer’s decision: the employer pays the full premium or shares it with employees. The premium is calculated from the headcount and the group’s average risk; because many people are insured, the insurer may apply a group discount. The premium paid by the company is reflected in employees’ payroll.

How does the tax advantage work?

Group health premiums the company pays for its employees can be accepted as a general expense when determining the corporate tax base; for premiums reflected in payroll, there may also be an income tax advantage within legal limits. We recommend asking your accountant about the details.

How do you apply?

• Quotes are obtained from insurers with the employee list and the desired cover; we do this for you with several insurers.
• The chosen insurer carries out a risk assessment of the group.
• Once the application is accepted and the full premium or down payment is paid, the insurance starts.

What happens if an employee leaves?

If an employee resigns, is dismissed or retires, the employer informs the insurer and the person is removed from the group. For exits during the policy period, the premium for unused days is calculated on a daily basis and refunded to the employer. Some insurers also offer departing employees the option to continue with an individual policy.

5. Frequently Asked Questions About Group Health Insurance