What is the typical sum insured in a group mediclaim policy?

The typical sum insured in a group mediclaim policy in India ranges from ₹1 lakh to ₹5 lakh per employee, with ₹3 lakh to ₹5 lakh common among mid-sized and larger employers. The sum insured is set by the employer when it designs the master policy and applies per employee or per family on a floater basis, meaning the amount is shared across the employee and covered dependents.

What sum insured do most employers choose?

Most employers set the sum insured between ₹3 lakh and ₹5 lakh per family, balancing premium cost against meaningful hospital cover. Startups and smaller companies often start at ₹1 lakh to ₹3 lakh to keep premiums low while still offering a real benefit. Larger employers and those in high-cost metros tend toward ₹5 lakh or more, and some offer tiered cover where senior employees carry a higher sum insured. The figure reflects the employer’s budget and the medical-cost environment where employees are based.

Is the sum insured shared with family members?

In most group mediclaim policies the sum insured is a family floater shared across the employee, spouse, children, and sometimes parents. A floater of ₹5 lakh means the whole covered family draws from the same ₹5 lakh in a policy year, rather than each member having a separate limit. If one family member uses the full amount, the balance available to others is reduced for the rest of the year. Some employers add a separate parental sum insured or allow employees to buy a top-up to raise the limit.

How does the sum insured affect the premium?

A higher sum insured raises the premium, but not in a straight line, because most claims fall well below the upper limit. Moving from ₹3 lakh to ₹5 lakh increases the premium less than proportionately, since high-value claims are relatively rare. Group pricing also depends on the age mix, family size, claim history, and the industry. Employers often use this non-linear relationship to offer a more useful sum insured for a modest premium increase.

Should employers offer a higher sum insured or a top-up option?

Employers can either raise the base sum insured for everyone or offer a voluntary top-up that employees fund themselves. A higher base benefits the whole workforce but raises the employer’s premium. A top-up or super top-up lets employees extend cover above the base limit at group rates through payroll deduction, which keeps the employer’s cost steady while giving employees who want more protection the option to buy it. Many programmes combine a reasonable base with an optional top-up.

How Plum approaches this

Plum sets up group health and group term life cover for companies with a minimum of 7 employees, against the common assumption that a group needs only 2 or 3 members. The claims experience is measured: Plum holds a claims NPS of 79 and a median pre-authorisation turnaround of 45 minutes, well inside the one-hour cashless pre-authorisation window set by the IRDAI Master Circular of May 2024. Cashless access depends on the insurer underwriting the policy, so the hospital network varies; Plum places cover with insurers including ICICI Lombard, HDFC ERGO, Bajaj Allianz, Star Health, Niva Bupa, and Aditya Birla Health Insurance, and matches the network to where a company’s employees actually live and work.

Frequently asked questions

What is the minimum sum insured in a group mediclaim policy? Many policies start at ₹1 lakh per employee or family, though ₹3 lakh and above is more common in formal employment.

Can different employees have different sum insured amounts? Yes. Employers can set a tiered or graded sum insured by grade or designation within the same master policy.

Does the sum insured reset every year? Yes. The sum insured refreshes at each annual renewal of the group policy.