Workplace Insurance Schemes are a cost effective way for Employers to remunerate and reward their Employees. A group insurance scheme is one that the Employer arranges for their staff. Generally there are two types. Fully subsidised and Voluntary.
Voluntary schemes are paid by the Employee and it is the Employee who chooses the type and level of insurance that will be offered. The advantage to the Employee is the substantial discount on the premiums that these Voluntary Group schemes offer. The Employee must answer a health questionnaire which identifies any pre-existing conditions which can increase the likelihood of a claim needing to be made in the future.
The Fully subsidised scheme, however, is paid by the Employer yet provides the cover to Employee. It is the Employer who stipulates the type and level of Insurance that the Employee will receive – which is fair enough given that they are the one paying for it. While the fully subsidised scheme can offer much better discounts the biggest advantage is there are no health questions asked and qualifying pre-existing conditions are covered. Imagine the value to an Employee if they are unable to get any insurance due to an adverse health issue such as a history of having cancer. This Fully subsidised scheme may be the only way the Employee can get any insurance.
The advantage of the Fully subsidised scheme is that it offers something that may be deemed to an Employee as being of a much higher value that what it actually costs the Employer.
While these schemes are incredibly valuable to any organisation it is imperative that the Employees still seek an individual assessment of their insurance requirements by an Insurance Adviser. We have come across a lot of clients that have been confident that the insurance they are receiving from their Employer is enough to cover them for all their requirements. While in a few instances this may be true, generally it is not.
Employees need to know a few things about their Group insurance Scheme.
Not all insurance companies are equal so you should know who your provider (Insurance Agency) is.
You need to know what type of insurance you are covered for. Medical, Life, Trauma, Income protection - different types of insurance that cover you for different things and each of us have unique requirements. If your group scheme only offers Life insurance you may need to get your Adviser to arrange some Income protection insurance for example.
You need to know the level of cover the scheme offers. If you are covered for $300,000 life insurance but your personal situation requires cover of $500,000 you may need to get your Adviser to arrange a top up for the difference.
You need to know the restrictions that your policy covers. For example if you group scheme says your income protection insurance has a waiting period of 90 days you may decide to get your Adviser to arrange some other insurance to assist with the waiting period or even choose to build up an emergency fund that you are able to call upon if and when you need it.
