4. List two differences between a group health insurance policy and a non-group
ID: 1138791 • Letter: 4
Question
4. List two differences between a group health insurance policy and a non-group (individual) health insurance policy. Which type of policy tends to benefit a young, healthy individual? Which type of policy tends to benefit an older, unhealthy individual? Explain. 4. List two differences between a group health insurance policy and a non-group (individual) health insurance policy. Which type of policy tends to benefit a young, healthy individual? Which type of policy tends to benefit an older, unhealthy individual? Explain.Explanation / Answer
Group Health Incurance Policy: It is a group health plan that the employer of a company provides to the employees. This policy even covers the family of the employees.
Individual Health Insurance Policy: These are policies that a person buys on their own, to cover themselves against various deseases and illness.
Difference between Group Health Insurance Policy and Individual Health Insurance Policy.
COST:
The Group Health Insurance Policy is less costly as this policy is taken in bulk for many employees and the employees are not required to pay additional fees and hence the premium payed for a Group Policy is less.
The Individual Health Insurance Policy costs much more, as the individual buys his own poilcy. Thus the premium payed under an Invidual Policy is higher than what is payed under the Group Policy.
TIME PERIOD:
In a Group Plan, the plan is active only during the time an employee is employed in the company. Once the employee resigns or retires, the plan will not cover him/her anymore.
In an Indivdual Plan , it covers the individual at all times, or until the individual himself/herself decides to discontinue the policy.
Which type of policy tends to benefit a young, healthy individual?
A Group Health Insurance Policy will benefit a young, healthy individual as they are likely to work in a company for a longer period of time then an elderly person. Since group policy covers the young individuals health needs, he/she wont require any additional policies due to thier good health. Even the lower premium will increase their savings.
Which type of policy tends to benefit an older, unhealthy individual?
An Individual Health Insurance Policy will benefit older, unhealthy individulas. This is because, as the age increases, it is likely that an individual will retire from work leading to the discontinuance of the group policy provided by the company. So as the age increase it is advisable that the employee buys an individaul poilcy as it will become very difficult to buy a health cover after retirement specialy if the person has got a health issue.
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