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Insurance for startups and SMEs: Key considerations when choosing group health insurance

For startups and small to medium-sized enterprises (SMEs), resources and funding tend to be limited at the beginning and need to be spent wisely. While it may be tempting for business owners and HR leaders to skip employee benefits, such as group health insurance plans, firms that go above and beyond to make their employees feel valued are the ones that thrive in the long run. That’s because studies show time and time again: happy employees are productive employees.

In Hong Kong, where the cost of health insurance can be quite high, many startups and SMEs may be overwhelmed by the process of choosing and implementing a group health insurance plan. So, in this Pacific Prime Hong Kong article, we’ll walk you through the things you’ll have to take into account when choosing a group health insurance plan.

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Choosing a group health insurance plan

1.Picking whether to go with a group or individual type

Most insurance providers only accept group health insurance applications from organizations with more than two employees. If you meet this requirement, then you can proceed with the application. When compared to individual health insurance, group health insurance plans tend to be a better option as it covers pre-existing conditions and has lower overall premiums. For firms with less than two employees, you’ll have no choice but to resort to choosing individual health insurance plans.

2. Deciding on the area of coverage: local or global

Whether you go for local or global coverage will depend on how much traveling is required for work. If your employees frequently make trips overseas, then you should fork out a bit more for a plan with global coverage. On the other hand, if your team is mostly based in Hong Kong, local coverage will suffice. Of course, getting short-term health or travel insurance whenever it’s needed is also an option. However, bear in mind that having to look into plans every single time someone flies out can be troublesome and could possibly cost more over time!

3. Determining the extent of coverage: optional add-ons to include

It’s no surprise that the more comprehensive the plan, the more it’s going to cost you. What many SMEs do is that they provide basic coverage to all staff and offer insurance add-on depending on seniority. Giving senior staff these add-ons can also serve to incentivize employees to stay at your company and decrease the overall employee turnover rate.

You can choose from the following benefits:

  • Inpatient coverage: This covers all hospitalization-related expenses. Generally, all health insurance plans will offer inpatient coverage, as it is seen as the bare minimum in the world of health insurance.
  • Outpatient coverage: This provides coverage for consultations and treatments that do not require staying in the hospital overnight. For example, visiting a General Practitioner (GP) or getting a health checkup after being discharged from the hospital.
  • Dental coverage and vision coverage: These are other optional add-ons that cover dental and optical expenses. Typically, this would include both routine and major treatments.
  • Maternity coverage: This is another add-on for female employees expecting to conceive a child, covering everything from prenatal, delivery, and sometimes postnatal emergency care.

(Do note that dental, optical, maternity coverage and more tend to increase the premium of the policy, however, having them can help retain employees and attract talented candidates that are drawn to non-monetary benefits. Find the right balance between the needs of your workforce and your budget.)

4. Go for user-friendliness: traditional or tech-savvy insurers

Once you have an idea of the plan you require, you need to figure out the kind of insurance company you want to go for. Traditional insurers tend to rely on agents and usually require a lot of paperwork. If you don’t have a well-staffed HR department, or would rather not overcomplicate things, tech-savvy insurers are a good option. Whether it’s selecting doctors, booking appointments, or making claims, having an easy-to-use online platform to do this will save both you and your employee some valuable time. Telemedicine is also considered an interesting benefit for employees too. This is true given the current COVID-19 crisis the whole of Hong Kong, as well as the rest of the world, is currently in.

5. Review the legal aspects of insurance: using insurers that comply with data laws

Given that there’s a huge amount of employee data the insurer will have to deal with when providing group health insurance, it’s important to ensure that data privacy laws are adhered to. If your firm has employees from the EU/EEA, special attention will also have to be paid to the General Data Protection Regulation (GDPR). To ensure this takes place, it’s best to go with an insurer or a broker that’s globally reputable and compliant with laws. Pacific Prime Hong Kong’s insurance experts can provide further details and ensure you are matched with insurers that are compliant and regulated.

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Here are some additional reads to better your understanding of group health insurance:

Get in touch with Pacific Prime Hong Kong

Pacific Prime Hong Kong is one such global insurance broker and employee benefits specialist that is fully compliant with data privacy laws. With over two decades of experience working with corporate clients, we are well-placed to help your SME choose a group health insurance plan that suits your needs.

For more detailed information and the steps towards securing group health insurance, head to our Corporate page for a breakdown of the essential solutions available to startups and SMEs.

Feel free to compare health insurance plans online today. Or, if you’d rather speak to an advisor, then our multilingual team is more than happy to help!

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Senior Content Creator at Pacific Prime Hong Kong
Suphanida is a Senior Content Creator at Pacific Prime, an award-winning global health insurance and employee benefits specialist.

With over 5 years of experience in the field, Suphanida spends the majority of her day synthesizing complex pieces of insurance-related information and translating this into easy-to-understand, engaging, and effective content across a variety of media such as articles, infographics, whitepapers, videos, and more.

Suphanida is also responsible for planning and publishing three whitepapers released annually by Pacific Prime: The State of Health Insurance Report, The Cost of Health Insurance Report, and The Global Employee Benefits Trends Report. Additionally, she handles the LinkedIn profiles of Pacific Prime’s Founder and CEO, as well as Global HR Lead.

Suphanida’s strengths lie in her strong research and analytical skills, which she has gained from her BA in Politics from the University of Warwick and Erasmus Mundus Joint MA in Journalism from Aarhus University and City, University of London.

Being of Thai-Indian origin and having lived, studied, and worked in Thailand, the UK, and Denmark, Suphanida also has a unique, multicultural perspective that helps her understand the struggles of expats and globetrotters.

Outside of work, she enjoys traveling to new places and immersing herself in different cultures.
Suphanida Thakral