In the contemporary landscape, alongside salary and career advancement, job seekers increasingly factor in additional company benefits when evaluating potential employment options. Among these offerings, the provision of group insurance for employees garners considerable attention. A robust group insurance package typically encompasses life insurance, severe illness coverage, accident insurance, medical insurance, and in certain enterprises, enriched benefits might include supplementary employee annuities and premium medical services. Undoubtedly, these benefits play a pivotal role in attracting top-tier talent to each organization. Many candidates opting to align with companies that offer such substantial perks often believe that the encompassing nature of group insurance renders personal insurance coverage redundant, or even replaceable. However, does this assumption hold true?
To delve into this matter, let's initially discuss the merits of group insurance. Firstly, group insurance exhibits lenient health disclosure requirements. Given the substantial number of individuals covered under group policies, the likelihood of individual adverse selection and moral hazard is minimized, thereby permitting looser restrictions on past medical histories. Even those with a pre-existing medical record generally encounter smoother coverage approval. Secondly, the scope of reimbursement tends to be broad. Numerous group medical insurance plans extend reimbursement to encompass outpatient care, limited dental treatments, and maternity-related expenses for female employees—often encompassing services rarely embraced within individual medical insurance plans. Lastly, the scope of coverage extends to family members. Many company-offered group insurance policies permit the inclusion of spouses and children under the coverage umbrella, often at preferential rates. Given these myriad advantages, it's tempting to conclude that company benefits provide comprehensive protection. However, is this truly the reality?
Despite the fact that many corporate group insurance plans do encompass severe illness, medical, and hospital coverage, their all-encompassing nature is compromised by the absence of life insurance. A recent case emerged wherein an employee who had served a foreign-funded logistics firm for 24 years was diagnosed with liver cancer during a physical examination three years prior. To his astonishment, his monthly earnings plummeted from 25,000 dollars to a mere 1,200 dollars the month following his hospitalization. The company's human resources department contended that the adjustment in his remuneration during his medical leave adhered to pertinent legal regulations and was thus legally sound. From the insurance company's vantage point, during the employee's initial year of treatment for severe illness, group insurance would cover the associated expenses. However, in the subsequent year, the employee's deteriorating health might hinder his capacity to fulfill his original duties, resulting in his exclusion from the group insurance policy. The insurance company might either request the employee's exclusion or restrict the policy's coverage to exclude the specific ailment. At this juncture, the ailing employee is typically no longer eligible to acquire personal commercial medical insurance. If the company terminates his employment due to incompetence, the situation worsens. Ergo, group insurance does not, to some extent, rival the benefits of commercial insurance.
Furthermore, the coverage provided by group insurance often falls short. Due to budgetary considerations and the requirement to offer comprehensive protection, the scope of coverage for each aspect tends to be rather constrained. When purchasing insurance, the objective is two-fold: obtaining substantial coverage and achieving comprehensive protection. In the aforementioned news story, the logistics employee's critical illness necessitated ongoing treatment, and the meager coverage provided by low-insured group insurance proved insufficient to defray the continuous expenses incurred during this duration. Moreover, the coverage is not all-encompassing. Presently, company-provided group insurance primarily safeguards against a single severe ailment, and once a claim has been made for such an ailment, the policy cannot be renewed in the future. As severe illnesses are increasingly manifesting in younger demographics, a one-time payout from a severe illness insurance policy is glaringly inadequate. Furthermore, the protection is confined to current employment, omitting post-employment periods. The group insurance procured by a company follows the employer's trajectory rather than the insured individual's. This implies that when a job transition transpires, the security blanket dissipates. The endeavor to obtain personal coverage after leaving the job may result in higher premiums due to aging, and modifications in physical health might even preclude eligibility for coverage.
Upon recognizing the drawbacks inherent in group insurance and discerning its divergence from commercial insurance, a more comprehensive understanding of the sufficiency of company-offered group insurance coverage can be attained.
