The Pros and Cons of Group Medical Insurance

Posted by on Jan 30, 2018

Have you ever wondered about how medical insurance works? The best way to educate yourself on any topic is through research. Therefore, in the article below we’re going to look at the pros and cons of group medical benefits in Alberta.

The ins and outs of health insurance in general are complicated, but we can be thankful they come with many options.  It’s possible to have a group insurance policy through work, an individual personal insurance policy or have a group policy topped up with an individual policy. Unfortunately, though, many Canadians go without extra health insurance of any kind.

Pros and Cons of Group Medical Insurance

To help you we’re going to look at the pros and cons of group medical insurance while comparing your two main options – group medical insurance and personal insurance in Alberta. How do these types compare?  Below is a brief analysis.

Group Health Insurance in Alberta vs Individual Health Insurance in Alberta

The Basics – Group Health: A group medical insurance policy is taken out by an employer, and they offer it to their eligible employees.  With a group plan the employer chooses which services the plan will include and how it will be offered to their employees. The premium costs have options as well but the most common way of doing it is employers go with a split cost between them and their employees.

Sometimes medical benefits are tiered to positions within a company; for example, the receptionist’s services will be different than upper management. This is most common with larger firms.

The Basics – Individual Health Insurance: This is a type of insurance product where individuals purchase a policy for themselves, and their family. They choose which health services they want and then find an insurance carrier that sells the kinds of services they need at a price they can afford. For example, dental coverage might be more important than prescription coverage.

Both are usually purchased with the guidance of an insurance broker, or other group insurance professional to help them understand plan choices and premium costs.

Length of Coverage With Group Insurance: A group medical policy stays in place until it’s cancelled by the company or plan leader (provided the premiums are paid). But, when an employee quits, is fired or laid off their health benefits stop, or change. This can also happen when their hours change or position in the company changes.

Some insurance policies allow employees to retain their benefits and pay the premiums themselves, sometimes at a more expensive cost.

Length of Coverage with Individual Insurance: Again this policy stays in place until the policy owner decides to cancel it provided the premiums are paid. The individual also has the option to adjust and change the plan as needed.

It’s common for small business owners to decide between offering their employees traditional group benefits and offering individual health reimbursement.  The above scenarios discuss traditional policies. There’s also another option for small business or entrepreneurs. It is called a Health Spending Account (HSA).  With this an employer puts a set amount of money aside for medical benefits and the employee is reimbursed. They can use the sum for whatever benefits they want if they fall under the plan benefits.

For more information to help you understand the pros and cons of group medical insurance in Alberta, please speak with an insurance broker.  The consultation is free and will help you decide which health insurance product best suits your situation.