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How To Calculate Group Health Insurance
If you manage your own business, one of the requirements is that you provide health insurance for your employees. This can be a very difficult choice to make because you will handle the majority of the expenses for the group health insurance. There are plenty of insurance providers that you can turn to, but before signing up for a health insurance plan, compute the group health insurance costs and coverage through these steps.
Employee health. The health of your employees will determine a large part of the rates that will be provided by the insurance company. Generally, healthier employees have better rates when it comes to group health insurance, because healthy individuals have smaller chances of contracting illness or diseases that the insurance company will have to pay for. One of the best ways of doing this is by screening your employees first for health and fitness, but without discriminating on the handicapped especially if the handicap will not interfere with the job.
Age. Next, consider the age of the employees. Generally, a firm or office with an aging pool of employees will have more expensive group health insurance, since insurance companies generally assume that older people are more prone to diseases and illnesses because of aging. Statistically speaking, chronic diseases either develop or being to manifest in old age, which puts the insurance companies at a disadvantage. To gain their profit, the insurance company will generally increase the premiums for the group health insurance.
Job description. The types of job positions that are available in your company will also affect the cost of premium for the group health insurance. Office workers generally have lower premiums compared to job positions that require the workers to exert manual labor that opens up the workers to more risks of either direct injury or developed chronic body ailments. This is why construction firms have higher premiums to pay when it comes to group health insurance, compared to white collar firms.
Location. The place where you have established your office is actually another deciding factor for the base price of the premium. If you live in rural areas, the premium will be lower compared to businesses and firms that are located in the city. Urban areas are generally much more expensive when it comes to the cost of premiums.
Coverage. Also consider the type of coverage for the group health insurance. Will your employees receive a comprehensive health benefit package that includes dental health plans? If so, the premiums will generally increase. Other options that you can consider are disability coverage and life insurance. This will be better for the employees, but these also mean that you will have to face larger premiums.
Lifestyle. Also consider the lifestyle of your employees. For group health insurance service providers, tobacco users and alcohol users usually have higher premiums because the use of these substances generally increases the chances of contracting diseases and illnesses.
Once you have determined the type of group health insurance package that you want, be sure to close the deal with a cap that you can handle. Large firms and corporations can have health insurance packages that cap at several million dollars, but for smaller firms and business, several thousand or hundred thousand dollars should be enough.
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