Accidents are uninvited and can happen with anyone at any time, especially with people employed in workplaces exposed to chemicals or heavy plant and machinery or construction activities. Road accidents are also highly common in India. According to the latest records, road accidents claimed around 1.3 lakh lives in India and caused over 3.4 lakh casualties in 2020. Thus, as an employer, it becomes our moral duty to keep our employees financially secure against the risks of accidents. A Group Personal Accident Insurance plan is insurance coverage that provides financial aid to insured employees and their loved ones in case of accidental death, bodily injuries, and disabilities.
Who Are Eligible for Providing Group Accident Insurance?
The following are eligible for offering group accident insurance to the groups associated with them:
- Corporates including MNCs, startups, MSMEs, etc.
- Educational institutions like schools and colleges
- Non-Banking Financial Corporations (NBFCs)
- Professional associations such as those of lawyers, chartered accountants, etc.
What Is Covered Under Group Personal Accident Insurance?
Financial coverage is provided for the following cases under a group accident plan.
- In Case of Accidental Death of the Insured Employee
- Accidental Death Coverage – In case of the employee’s accidental death, 100% of the death benefit is payable as a lump sum to the nominee under the plan to help them remain financially stable in times of grief.
- Transportation of the Mortal Remains – In case of an on-spot accidental death, a group accident plan provides coverage for arrangements necessary to transport the mortal remains of the deceased employee to the burial ground from the site of the accident.
- In Case of Bodily Injury of the Insured Employee
- Hospitalisation Expenses – In case of bodily injuries sustained by an employee during an accident, all the hospitalisation expenses get paid via the insurance coverage of the group accident plan, subject to the plan’s sum assured amount.
- Ambulance Expenses – The plan also provides for ambulance expenses incurred by the employee or their family for reaching the hospital for the treatment.
- In Case of Disability of the Insured Employee
- Disability Treatment – If an employee meets a temporary or permanent or total or partial disability, then compensation is provided under the plan to help them get quality treatment.
- Weekly Compensation – In case of disability, weekly compensation is also provided under the plan for a certain period to help the employee and their family meet their daily expenses.
- Child Education Coverage – If the disabled employee has children who are completely dependent on them, the plan provides child education coverage to ensure no breaks in their education.
Is Group Accident Insurance Mandatory?
No, as per current rules and regulations of the Insurance Regulatory and Development Authority of India (IRDAI), employers don’t need to offer Group Personal Accident Insurance plans to employees. However, it is the moral duty of employers to keep their human resources safeguarded against accidental risks as they become vulnerable to these risks because of their job.
Is Medical Check Mandatory for Group Accident Policies?
No. There is no requirement for the employees to undergo a medical checkup to enrol under a group accident policy.
Why Should Employers Provide Group Accident Insurance?
Following are some key reasons why employers should offer group accident insurance to their employees:
- High Employee Motivation – When we provide group accident plans to our employees, they feel that the company cares for them. This feeling of being valued increases their motivation to work for the organisation’s goals.
- Employees’ Wellbeing – By providing group accident insurance, we as employers can ensure our employees’ well being by providing them access to affordable and quality healthcare. This ensures that our business operations suffer from no or minimal hiccups.
- High Employee Retention Rates – When employees feel valued and cared for, they do not wish to leave the company, and this helps us keep our employee retention rates high and recruitment costs low.
- Brand Value Appreciation – Employees represent a company’s culture and values. When employees feel valued, they spread the word in the job market via personal interactions and social media. This helps a company build a good brand name for itself.
- Happy Workplace – Motivated and happy employees create a cordial workplace. And a cordial workplace boosts teamwork, leading to increased efficiency and better business for the company.
- Tax Benefits – As an employer, we can also avail of tax benefits by providing a group accident plan to our employees. Any premium amount we pay towards these plans qualifies as a business expense and is thus exempted from tax treatment under Section 37 of the Income Tax Act.
Group Personal Accident Insurance is an effective and economical fringe benefit that we as employers must offer our employees out of our moral obligation towards them. Besides offering financial aid to our employees in difficult times, group accident plans help keep our employees motivated and forward-looking to work every day. It also helps us retain and attract the good talent necessary for any company to achieve growth and success. As employers, we should also encourage our employees to get Digital Health Cards online to have an electronic database of their medical history available at all times in case of any health emergency. This will enable them to get the required treatment speedily and effectively.