Difference Between Family Health Insurance and Group Health Insurance

When it comes to health insurance policies that cover multiple people, most people get confused between family floater and group health insurance. Both are among the best health insurance plans policies and provide great coverage in case of health emergencies.

However, both have major differences and are designed to serve different purposes. So, let us clear this confusion and try to understand what is floater in health insurance and what group health insurance is.

What is Family Floater Health Insurance?

A floater family health insurance covers an entire family’s health concerns. The policy buyer can include their family members in it, including spouse, children and parents. The sum insured in such policies is shared among all the insured members in case of medical emergencies.

What is Group Health Insurance?

A group health insurance policy is an insurance type that provides coverage to a group of people, commonly office employees. The master policyholder buys the insurance, i.e., the employer. The employer also pays its premium and in return, the employees are provided with insurance certificates.

Difference Between Family Health Insurance and Group Health Insurance Policy

Eligibility

Anyone over 18 can buy family health insurance to provide coverage for their family. However, the group health insurance policy is specifically designed for organisations and corporate groups. The covered members or employees get coverage until they leave the organisation. Once they resign, their coverage is withdrawn by the employer.

Coverage Extent

Family health insurance extends policy coverage to family members like spouses, children and parents. Some insurance companies also allow additional family members, such as siblings, in-laws, etc, to be added under the insurance cover.

On the other hand, in a group health insurance policy, coverage is provided to the organisation’s employees only.

Premium Payment

Under family health insurance, premium payments are made by the policy buyers themselves as they buy insurance for their family. However, in a group health insurance policy, the premium is paid by the master policyholder, which, in most cases, is the employer or organisation.

Policy Control

Family floater health insurance is bought by an individual policy buyer for their family protection. Thus, they have complete control and access to it. They can add benefits, customise plans, etc.

While the employer buys and manages group health insurance policies, it has little to no control over individual members’ insurance.

Claim Settlement

In a family health insurance plan, the claim settlement process is completed by the TPA (third-party administrator) or insurance company. While in a group health insurance policy, the claim is settled by the TPA appointed by the insurance company.

Tax Benefits

As per Section 80D of the Income Tax Act, the family floater policy buyer can claim tax deductions for their annual premium payments. However, employees cannot get any such tax rebate for group health insurance because the employer buys it. However, employees can claim tax deductions for any extra charges paid by them.

To Sum It Up

Both family floater health insurance and group health insurance policies have specific benefits and exclusions. While having a group health insurance policy provided by the employer is great, it is suggested that you get family health insurance for yourself and your family members for additional protection.

Finally, to get the most protection, be informed about the insurance type and its policy terms, benefits and other important aspects.