An insurance cover from the employer is a huge source of comfort for many individuals. Especially, because it also covers their elderly parents or in-laws. In fact, many people consider the employer's group health policies extremely valuable because otherwise they would find it difficult to obtain a health cover for their elderly parents due to higher cost of premium.

However, many organisations are placing curbs on parental coverage and, in certain cases, completely withdrawing the facility. A recent study released by insurance broking firm Marsh India reiterated this point. "Complete sponsoring of parental coverage by companies has dropped from 51% in 2010 to 40% now," informs Marsh India CEO Sanjay Kedia. "Twenty-five percent of the participants insist on employee contribution now against 20% last year, while 35% of the companies have withdrawn this facility completely."

"Some companies had capped the benefits provided to employees' in terms of parental coverage and the trend continues this year as well," Adds Sanjay Datta, head, underwriting and claims, ICICI Lombard General Insurance. The move is prompted by high claims ratio that may push up the subsequent year's premiums. Since claims arising out of parental coverage are likely to be high, companies are scaling down these benefits to reduce costs. Worse, according to the survey, this trend is likely to continue next year too.

IF YOUR PARENTS ARE SENIOR CITIZENS

This is perhaps the most difficult situation to manage. Especially, if they have been entirely dependent on your employer's group cover so far. Buying a fresh cover at this age is bound to be an expensive affair. Also, you may have to be content with a smaller range of benefits you (and your parents) were used to under the group cover.

"The first thing that is required while scouting for covers at this age is a change in mindset. They (employees and their parents) have to realise that there may be no perfect product available. They should be open to an imperfect solution," advises Mahavir Chopra, head, e-business, medimanage. com. "Individual policies will not cover everything and they need to understand that it is better to have something rather than being without a cover."

If your parents are senior citizens, you should consider buying dedicated health policies offered by companies like National Insurance, Star Health & Allied Insurance and Bajaj Allianz. Moreover, while buying a policy you need to remember the product could come with co-pay ratios, ranging from 10% to 25%. Essentially, this means that for every claim of Rs 100, you will have shell out Rs 10-25 from your pocket before the company chips in with the balance. Then, of course, you will have to factor in high premiums and also, deductibles as well as sub-limits that place ceilings on room rent, operation theatre charges or surgeon fees. Again, this means that any cost over and above what the policy promises to discharge will have to be borne by the policyholders.

IF YOUR PARENTS ARE UNDER 60

Like in the case of senior citizens, buying a new policy is unlikely to be a simple process. But, if they have been dependent entirely on the group cover offered by your employer so far, you need to buy an independent cover for them as soon as possible. Apart from the compromises mentioned earlier, you need to carry out a meticulous costbenefit analysis before zeroing in on a policy. Even though they are not senior citizens, premiums charged at their age cannot be termed economical. Hence, it is critical to ascertain the tradeoff between benefits and costs.

Also, there are no dedicated policies targeted at this age-group, which means that the number of policies to be studied goes up, making the task all the more onerous. "Irrespective of the age, it is best to go for covers that promise life-long renewal or at least up to the age of 80. After all, there is no point replacing a group cover with an individual one only to see it expire in 5-10 years. This is applicable to senior citizens' policies too," says Chopra.

In addition, you need to take into account permanent exclusions in the policy. For instance, some health insures today seek to exclude heart-related conditions, high blood pressure or cholesterol from the scope of coverage for life. If your parents are yet to cross the age of 60 and enjoy good health, buying an independent cover should not be put off, even if your company has not decided to restrict parental coverage.

DON'T IGNORE GROUP COVER

The key benefit of any group health scheme including parents in the floater policy is the coverage of pre-existing illnesses. Now, individuals whose employers have decided to withdraw parental coverage have no choice but to scout for standalone covers in the market or create a health fund. But those who have merely seen reduction in benefits need to consider other factors. While it is best to have an independent cover at all times, it doesn't mean that your employers' scheme - even in its contracted form - is completely redundant. If such employees find premiums for fresh cover unaffordable, they can go for top-up covers. "If policyholders feel that such group mediclaim covers fall short, they can opt for a top-up cover," says Datta of ICICI Lombard.

This will kick-in only after a particular limit in the basic policy is breached. Thus, they can make good any shortfall at a cost lower than that of a fresh policy. Similarly, if your company is willing to continue parental cover provided the employee foots that premium, you should opt for it. Likewise, introduction of a copay clause shouldn't deter you either. It would be a small price to pay for the benefits you would be getting in return. Benefits under group schemes are wider, most notably coverage of pre-existing diseases, and hence, these two arrangements would work in your favour.