Addressing Common Myths About Group Insurance for Employees

Group medical insurance is one of, if not the most popular employee benefit in Singapore, providing a cost-effective way for workers to access healthcare and other types of coverage. However, many employees and employers misunderstand certain aspects of group insurance, which can lead to confusion and dissatisfaction with the coverage. Here are some common misconceptions about group insurance coverage in Singapore: 

Myth #1: Group Insurance Is Too Expensive for SMEs 

Many small business owners find group insurance for employees will strain their financial resources and decide to offer flexible benefits instead. However, group insurance plans are a more cost-effective option, as businesses can secure better premium rates by spreading the risk across all employees. This contrasts with individual policies, where the risk is not shared, resulting in higher premiums.  

Additionally, employers can also deduct premium payments as business expenses, which can help reduce their overall taxable income. This tax benefit makes group insurance even more affordable, offering an added financial incentive for businesses to provide coverage for their employees. 

Myth #2: Everyone in the Company Has the Same Level of Coverage 

Not all employees in a company have to receive identical group insurance benefits. By assigning employees to different categories of employment, coverage may vary depending on factors like job position, seniority, and whether the employee is a S-Pass / Work Permit holder. 

For Foreign Workers in Singapore who are holding the Work Permit or S-Pass, it is mandatory for employers to purchase and maintain medical insurance coverage of at least $60,000 per year for each worker. 

Myth #3: Small Group Plans Offer Limited Coverage 

The current group insurance market offers comprehensive coverage designed to suit the scale and budget of individual businesses. Insurance providers now offer a wide variety of coverage options for businesses to choose from, such as general practitioner visits or more specialised treatments.  

The flexibility given means that businesses no longer need to settle for smaller and limited insurance plans with minimal coverage and focus is more on finding a plan that balances between comprehensive coverage and affordability. Businesses can now get the most value from the insurance while employees are well-protected.  

Myth 4: Individual Insurance is Redundant if Employees Are Covered By A Group Plan 

Even if employees are covered by a group insurance plan, it can still be a good idea to have individual insurance. As the benefits covered in group insurance are banded to fulfil most common needs, it is not possible to customise it on the individual level to meet every employee’s specific needs. 

Additionally, group insurance is tied to employment, hence coverage ends if the employee leaves the company. This makes personal insurance essential for long-term security. 

Myth #5: Complicated Administrative Work 

Some organizations hesitate to offer medical benefits for employees, assuming it will involve complex administrative tasks and require additional manpower. However, many insurance providers, including eazy Insurance, offer personalized digital platforms that streamline policy management and claims processing that allows individuals or organisations to handle insurance tasks efficiently.  

By using these digital solutions, administrative tasks such as policy updates, premium payments, and claims submissions can be done quickly online, which cuts down on the time and effort traditionally needed for these tasks. This reduces the overall workload for both the insured parties and the insurance providers, making it easier to manage group insurance plans for everyone involved.  

Myth 6: Only Large Companies Can Afford or Qualify for Group Insurance Plans 

Although it is often easier for larger companies to secure group insurance due to their larger workforce and negotiating power, smaller businesses can also access group insurance plans. 

Many insurance providers offer group insurance plans specifically designed for small and medium-sized enterprises (SMEs). These plans tend to be more affordable and tailored to the needs of smaller businesses. Typically, SME insurance starts with as few as 2 employees and the benefits and premiums might differ compared to larger companies. 

Myth #7: Changing Insurance Providers Is Too Troublesome 

Although there are more extensive coverage options being offered in the market, some businesses are reluctant to switch providers due to the extra work involved, such as submitting documentation to both the current and new insurers. There's also the concern of a potential coverage gap during the transition, leaving employees without insurance for a short time, which is a risk no business wants to take. 

However, experienced insurance providers are equipped with the expertise and resources to manage a smooth transition with no coverage interruptions. By coordinating with both the old and new insurers, they ensure that employees remain fully covered throughout the entire process, while also securing more comprehensive coverage options. 

Choosing The Right Group Insurance Coverage 

When choosing the group insurance for employees, businesses should: 

• Assess the employee’s preferences and healthcare needs via surveys and reviewing past health history and claims data
• Comparing various insurance providers and plan options to identify the one that offers the best value, coverage, and alignment with both your employees' needs and the company's budget.
• Carefully reviewing the policy terms and conditions is essential when selecting or switching insurance providers. Businesses must fully understand the coverage and exclusions to avoid surprises if employees need care that isn't covered by the plan.

At eazy, we understand the unique challenges small businesses face in Singapore. Our platform is designed to help you navigate the intricacies of selecting the best insurance policies tailored to your specific needs and budget. Contact us today to help you make informed decisions that ensure your employees are cared for.