Group insurance is designed so that employers, unions, and other organizations can get widespread coverage for their members at a reasonable cost. Instead of getting individual coverage for each person in a company or organization, insurance companies offer group plans for the entire group that overall tend to be less expensive.
Who Does It Cover?
Overall, group insurance plans cover those in the group with the same benefits. With major insurance plans, the individuals generally get membership through payroll deductions from their work. Still, additional benefits are available to buy into. Family members are usually covered under the group, but the deductions will be higher.
Advantages to a Group Insurance Plan
What’s nice about a group insurance plan is that because you are essentially buying “in bulk” you can get a much cheaper rate than you might be able to get with an individual plan. You are also part of a group that has more bargaining power when negotiating with the insurance company. If you have an individual insurance plan, you are pretty much on your own when it comes to any questions, claims or disputes you may have.
Also, to try to extend your protection to your family will probably cost additional premium money under an individual plan, whereas this protection is often covered under your group policy.
Disadvantages to a Group Insurance Plan
The problem with the group insurance plan is in some ways the same as the advantage; being part of a group. If you are in a better position to negotiate with the insurance company for better rates or better coverage, you may want to be considered a separate entity to the insurance company.
If you are part of the group, you can only get the best rates and contract that the group gets. The chain is only as strong as its weakest link. In addition, with a group plan there may be more restrictions on the doctors you can see or the drugs you can get under the plan. With an individual plan, there will often be more flexibility in these matters.
No comments:
Post a Comment