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Tax benefits under group health insurance can be availed for employers as well as employees. Know all about tax deductions under group health insurance.

Tax benefits in group health insurance plans are one of the most popular and lucrative components of corporate-sponsored healthcare. Here is why:

  • Employees need not pay for the group cover (for themselves and their families) as the employer bears the entire cost.
  • Group insurance cover makes the employer eligible for saving tax.
  • Due to the recent Covid-19 pandemic, the Indian government and the Insurance Regulatory and Development Authority have made it mandatory for companies to provide group medical cover for employees. 

If you are a start-up, MSME, or corporate, employee cover is the best health benefit that you must avail yourself of and for your modern workforce. Here is a list of different types of organizations that can apply for a group insurance scheme.

Start-upsStart-upsPublic Listed CompaniesPrivate Limited CompaniesSole-proprietorshipMSMEs

MSME - Micro, small and medium enterprises.


Tax Benefits of Group Medical Cover for Companies

As a corporate owner, you can avail of tax benefits on the premium paid for covering the employees. As directed by Section 80C of the Income Tax Act, expenses for buying a group medical plan are eligible for tax benefits. In addition, the listed tax benefits have been declared as 'employer entitlement' as per the IRDA Act, 1999.

Tax Benefits of Group Medical Cover for Employees

As an employee, if you contribute towards the premium for your group cover, you can avail of income tax deductions under Section 80D of the Income Tax Act. Many organizations offer a facility where both the employer and employee can contribute to the group mediclaim policy.

How does this work?

Let us help you understand better. Here are a few instances where you can/cannot avail of tax deductions on group health insurance coverage plans.

Type of CoverTax Saving Benefits for EmployeeWhy?

Complete Employer SponsoredNoIn this situation, the entire cost of health cover is paid by your company. Only your employer can avail of tax deductions.Partial Employer ContributionYesYou can claim a deduction for your share of the premium contribution.Additional ContributionYesYou can avail of a tax deduction for the top-up plan purchased by you for enhancing the employee cover.

Note: The type of group insurance cover and contribution depends on the taxation structure and policy set up by your employer.

With Plum Insurance, increase your existing employee cover by Rs. 20 lakhs with a super top-up plan! This is exclusive to companies that are utilizing the group medical cover offered by PlumHQ.

Why Should You Buy Group Health Insurance?

Tax benefits are not the only reason you should purchase a comprehensive health insurance coverage plan as an employer. There are multiple advantages of buying group mediclaim for your workforce. Here is a common feature list for the same.

  • Tax benefits for your corporate organization and your employees.
  • Pre-existing diseases are covered from day one.
  • Includes cover for your entire family or dependants - Spouse, Children, and Parents.
  • Group insurance provides cover for Covid-19.
  • Enhance your overall cover with different rider options (add-ons).
  • Seamless cashless process.
  • The cost of group cover is less than individual health insurance.


What are the Eligibility Criteria for Group Insurance?

There is no specific metric applicable for availing group health insurance. As long as you are a full-time working employee, you will be covered under group insurance offered by your company. With Plum, we cover teams with sizes as minimum as seven members!

The Plum Benefit

At Plum, we have created the best combination of healthcare and well-being for the modern working environment. Here’s to name a few:

  • Get comprehensive health cover with a super top-up option.
  • Access to doctor teleconsultations - Book an appointment from anywhere!
  • Quick claims process via WhatsApp.
  • A single dashboard for a seamless employer and employee experience.
  • Keep your employees engaged with Plum Wellness.
  • Personal accident cover for employees.
  • Schedule a health check-up.
  • Access your health details on the Plum app.
  • We provide cover for LGBTQ partners.

Check out Plum Insurance here.