Individual Insurance Vs. Group Insurance, What Changes


When considering a health insurance plan; you have likely come across terms like individual insurance and group insurance. You would also have encountered group insurance if you are working in any corporate. However, very few understand the nuances and implications of the two types of policies and get a proper cover for themselves. Here, we help you compare both types of insurance to help you understand them better. Stay hooked!


Foremost, let us understand what each term implies. Individual insurance is a type of insurance that you would purchase for yourself and your family. It also includes family floater in which all the members of a family get included to be protected against medical treatment costs. Thus, an individual health plan need not include only a single individual.

In contrast, group health insurance is a plan that is purchased by any organization to provide health coverage and other benefits to its employees. The organization can select any available group plan or even have a customized and tailormade plan crafted for his company.


An individual health plan is applicable at all times for all those members who are covered under it. The number of members covered remains fixed and cannot be interchanged.

But a group insurance plan is more flexible and like an umbrella. It provides protection to you only as long as you are employed with the company. The moment you switch jobs; you lose the insurance cover. Likewise, any new employee who joins the organization automatically gets covered under the insurance plan. Thus, a group plan is far more flexible than an individual plan regarding who gets covered under it.

Convenience and control

Depending on your medical and financial history, you may be denied individual insurance. Your medical history, age, etc. is critically examined and then you are granted the insurance. In group insurance, you face no such stringent investigation. You get automatically covered just on the grounds of being employed by the company.

Likewise, an individual has the flexibility to set the terms and conditions of the health plan in the individual type of plans to better suit his requirements. But one has no control in setting any terms and conditions of the group insurance plans. One has to abide by the terms and conditions that have been decided between the insurance company and the employer.

Premium amount

You need to pay a far lower insurance premium amount that you need to pay in an individual health plan. It is estimated that you need to pay about 30% lower premium in a group insurance plan than in an individual plan.

Maternity Benefit and coverage

You get full maternity benefits and coverage from day one under the group insurance. But this benefit is usually not present in an individual plan. You need to buy it as an add-on and get the cover in the individual policy.

Waiting period

There is no waiting period in a group insurance plan. You can avail of its full benefits the first day you join the job. But in an individual plan, you cannot avail of the benefits of the policy for the first 30 to 45 days of the policy apart from accidental hospitalization. In this regard, a group plan proves more beneficial.

Pre-existing diseases and medical checkups

There is no medical examination required for group insurance. Even your pre-existing diseases get covered from day one. But a medical checkup might be required in an individual plan. The pre-existing diseases get covered to a limit after a waiting period that can vary from one to four years. This way, group insurance proves advantageous than individual health plan.

No Claim Bonus

In this department, the individual health plan works better. If you have not made any claim in a year, you get a no-claim bonus which can get added over the years and give you added benefits. But you do not get any such benefit in a group insurance even if you have not made any claims in any given year.

Final Verdict

As evident, each type of Health Insurance Plan has its own benefits and drawbacks. While a group plan is definitely advantageous; it does not mitigate your needs for an individual health plan. A group insurance plan only provides you protection for as long as you are employed. But an individual health plan can provide you protection against medical expenses even after you retire and as long as you live. Hence, you can enjoy both plans and get yourself secure against all kinds of medical expenses.