If you are an employee or an employer, you may wonder which is better: group health insurance or Employee State Insurance (ESI).

Employee healthcare is a trending topic and the cornerstone of a company’s success. It is an essential element of the ethical growth and development of a company. Hence, insurance, be it group policy or ESI, makes up a significant contribution to employee healthcare.

Let us do an ESI vs. group insurance analysis and find out which is the better one. 

 Employee State Insurance (ESI) 

ESI is a self-financing social security and health-related insurance for Indian workers/labourers and is a policy managed by the Employees’ State Insurance Corporation (ESIC). This insurance plan provides comprehensive medical healthcare and aid during difficult times.

The ESI policy offers social and financial support to insured workers by offering paid leaves, financial compensation and medical benefits. This policy has provisions for disability and death due to occupational injuries, loss of income, maternity costs, dependant’s expenses and unemployment benefits.

 Group Health Insurance 

Group mediclaim insurance policy for employees is purchased by employers to offer coverage to all employees under one single plan, hence the name, group health insurance (GHI).

This policy is tailored to meet the collective healthcare necessities of company employees by offering a wide range of benefits, features, critical illness coverage, cashless hospitalisation cover and other inclusions. Further, group health insurance is tax deductible, which adds to its many benefits.

 Comparison: ESI vs. Group Insurance 

Feature	GHI	ESI
Cashless Benefits	Cashless hospitalisation coverage offers financial support for getting hospitalised, treatment and medicines in-network hospitals without actually paying any physical, digital or plastic money. With insurance policies like group health insurance, you can rely on your insurance provider to pay for your medical and associated expenses.	Instead of cashless hospitalisation and treatment, ESI offers cash compensation under their sickness benefit. The policy provides 70% of the average daily wage for cash compensation, up to 91 days in two consecutive benefit allowances.
Critical Illness	Group health insurance offers coverage for critical illnesses if the employer chooses a plan with the said inclusion. You might have to customise the policy accordingly to enjoy the benefits of this coverage. Companies like Tata AIG offer a wide range of add-ons allowing you to customise the policy. There might be a waiting period before you raise a claim, depending on the severity of the health condition.	ESI offers coverage for certain critical illnesses, such as cancer, cardiovascular diseases and tumours. Typically, ESI policies require a waiting period of 24 months or two years. Waiting period refers to the amount of time a policyholder has to wait before raising a claim. After contributing a policy premium for two years, the policyholder can claim their coverage.
Maternity Benefits	With group health insurance, a female employee or the spouse of a male employee can receive medical coverage for delivery, pre and post-natal care, baby one-day costs, hospitalisation and other medical costs. If the employer chooses maternity coverage in the policy, group health insurance offers a wide variety of benefits.	ESI offers maternity leaves and 26 weeks’ salary for a woman who goes on maternity leave for her pregnancy. The condition is that the woman must be enrolled in the workplace for a minimum of and more than 70 days.
Death Benefits	Group health insurance does not include any death benefits for employees.	If the death is a result of occupational injury or accident, ESI provides a pension to the dependent family members of the deceased.
Loss of Income	Group health insurance generally does not offer coverage for loss of income. However, you can opt for additional coverage or a rider for loss of income. This add-on provides a daily cash allowance to the beneficiary.	ESI provides financial compensation for the loss of income or job due to any occupation injury or accident. If the injury results in a permanent or temporary disability, the employee cannot work, resulting in loss of income. Hence, the policy supports the employee and their family.
Sum Assured	Group health insurance proves to be beneficial because there are barely any limitations on genuine and medically necessary treatments and procedures. The policy has a limited amount, as sum assured, that the employee and employer have decided upon at the time of issuance.	ESI does not have an overall limit for the expenses covered. However, an employee might find themselves in a pickle because there is a limited number of procedures and treatments covered under ESI.
Eligibility Criteria	There are no eligibility criteria regarding the income of the employees, the number of employees, the size of the organisation or the turnover. Your firm can buy group health insurance plans for your employees regardless of these factors. Some insurers may have a minimum number requirement though.	If an employer has 20 or more employees, they must provide ESI and PF for them. ESI is compulsory for employees who earn up to ₹21,000/—per month. Both the employee and the employer contribute to the funds.

ESI vs. Group Insurance: Which One is Better? 

The good thing about insurance policies is that each policy offers different and unique benefits and has something to offer for a section of people. ESI and GHI both work for the welfare of employees and workers. 

Employee state insurance provides coverage for a limited population from a certain income group that earns a limited amount of money; hence, the eligibility criteria. 

Group health insurance, on the other hand, offers flexibility, customizability, convenience and speed. 

 Ending Note 

Choosing between employee state insurance and group health insurance depends on multiple determining factors, such as salary limit, number of employees, benefits demanded, customisation, organisational budget and coverage needs. 

ESI offers comprehensive social security, and group policy offers flexibility, customisation and enhanced coverage.