Insurance Plans for Employees

health-insuranceCompanies are waking up to the dangers of modern-day work lives – where getting to work safely in the face of increasing instances of road accidents and even terror attacks – is a challenge. Groups like Essar, Godrej, Bajaj Auto and Max Healthcare are providing enhanced accidental death and disability benefits to their employees, apart from the standard existing life insurance covers and in-hospitalisation benefits, amid rising stress levels among employees, acute road safety issues in India and a frequently mobile workforce.

“Companies in India are incorporating and enhancing existing accidental death and disability benefits for employees. Such benefits are increasingly becoming more prevalent as opposed to hospitalisation and retirement benefits, which have stayed at similar levels over the past few years,” says Muninder Anand, director, information solutions business at Mercer.

As opposed to standard life insurance plans, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person, accidental death and dismemberment policies pay benefits if the cause of death or disability is due to an accident. The premiums are paid by the companies.

Companies like Essar, Godrej, Bajaj Auto and others put safety first, scale up accident benefits across levels
The growing prevalence of such benefits could be attributed to rising stress levels among employees, and a workforce that travels frequently, adds Anand. Drivers’ fault emerged as the single most important factor responsible for accidents and fatalities, according to a 2011 report on road safety by the ministry of road transport and highways. In all, it accounted for 77.5% of total accidents that year.

The problem of road safety remains acute in India, the report adds. There were 4.98 lakh road accidents in 2011, which killed 1.42 lakh people and injured more than 5 lakh persons, many of whom were disabled for the rest of their lives. Many of these victims were young people who were economically active, it says.

Accordingly, corporates are stepping in to cover the extent of damage. The Essar Group has revised and increased the covers for its group accident policy, which covers accidental deaths and disabilities arising out of accidents for employees across levels for the coming financial year. Under the revised slabs effective April 2013, the top management — including the CEO, business and functional leaders — will be entitled to an assured sum of Rs 2 crore, up from the current Rs 1.5 crore in cases of accidental deaths and disabilities.

Senior managers at the middle management level will be entitled to an amount ranging from Rs 40 lakh to Rs 65 lakh, up from Rs 30 lakh to Rs 50 lakh. Entry-level employees and first-time managers would be entitled to Rs 12.5 lakh to Rs 30 lakh, up from Rs 10 lakh to Rs 25 lakh. “These are precautionary measures we would like to take for our employees,” says Rahul Taneja, senior VP and head corporate HR.

Godrej doubled the accidental death benefits cover for its employees last year. “With increasing travel, accidental risks are going up. For us, these covers serve a larger purpose of what role an organisation should play for an employee’s safety and security,” says Sumit Mitra, Executive VP, HR at Godrej. The accidental death benefit cover for employees at the entry-level starts at Rs 30 lakh. Mitra refused to reveal details for senior levels. (Source: ET)

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