Employee Benefits, Global
Spotlight on India – A guide to rolling out global benefits technology
04.03.25
Similar to some European countries like France, Switzerland and Australia, India is a location with limited benefit options, low flexibility, and a reliance on state mandated benefits. So, you might expect an Indian benefits platform to be at the Simple end of our Simple-to-Complex benefits scale; most companies offer life insurance, personal accident, pension and medical, and some offer allowances for wellbeing, meal vouchers and EAP access. But the extensive medical insurance plan makes India more complicated than most other regions.
High competition for talent is driving competitive benefits packages – especially in the tech and professional services sectors in big cities. Indeed, our Evolution research found that 33% of employees surveyed in India are actively looking for a new job; slightly higher than the US (27%) and double the rates in the UK (16%), and Singapore (18%). Furthermore, 65% of employees in India say their expectations of their benefits package have increased in the last 12 months, particularly when it comes to flexibility and greater personalization of benefits.
Mandatory benefits
Pensions
Organizations have traditionally offered a state-funded Provident Fund, but supplementary pension plans are becoming more popular, with employees typically choosing contributions of 10% of their annual salary. Benefits are provided through the National Pension System-Corporate Sector Model (NPS-Corporate Sector Model) or group superannuation plan.
Employer and employee contributions covering retirement, death, and disability benefits from 2024 are as follows:
Employees’ Provident Fund (EPF):
- Employer contribution: 3.67% of pensionable salary
- Employee contribution: 12% of pensionable salary
Employees’ Pension Scheme (EPS):
- Employer contribution: 8.33% of pensionable salary
- Employee contribution: Not applicable
Group superannuation plans
Employer contributions typically range between 10% and 15% (most common) of employees’ total pensionable salaries. Employees do not typically contribute to the group superannuation plan, but where required, employee contributions typically range between 3% and 10% of the employee’s pensionable salary.
Life assurance
Our research shows that nearly half (46%) of Indian employees’ value life assurance above all other benefits and this is reflected by employers, with the majority of companies offering cover of three times the employees’ annual salary. Personal accident insurance is also very common, with disability provision included at three times the employees’ annual salary. We’ve also seen employers offer enhanced cover ─ at the employees’ expense ─ via their benefits offering.
Benefits are provided through a Group Life (GL) plan and the majority of international companies provide supplementary death in service benefits.
Group medical insurance
All multinational and leading local employers provide supplementary medical benefits. With limited state provision, medical insurance for employees and their families is highly valued; 65% of surveyed employees in India said it was important that their benefits offer them protection if they’re ill.
Medical cover in India is comprehensive – all employees are funded for themselves, their partner, two children, and two parents – and complicated, due to multiple layers of funding. The total cost to an employee can become confusing very quickly, especially where allowances are used for upgrades and additional family members. In most cases, employees can add various family members including their spouse, children, parents and parents-in-law. To further complicate the plan, parents and parents-in-law can have a different level of cover to the employee, their partner, and their children!
The medical plan is typically made up of:
- A core contribution from the company
- Optional additional contributions to enhance coverage and add dependents at the employee’s cost
- A number of optional add-ons often four or five plus
- Permutations for dependents
Employers normally finance 100% of the group health insurance plan premium to a base level, allowing employees to increase cover at their own cost. Some employers also finance a portion of premiums attributed to the dependents cover.
Popular benefits
Meal and lunch allowances
Most companies offer meal or lunch allowances and a stipend towards the cost of commuting for employees. Organizations with more advanced benefits offerings are starting to offer allowances to cover childcare costs and technology loans.
Flex funds
More organizations are starting to offer flex funds, so employees can choose different medical options and select other benefits such as increased life cover, health assessment, and pension contributions.
Any left-over funds are often allocated to a wellbeing or personal allowance that can be used for gym membership, including sports and health-related costs that medical plans might not cover.
The Salesforce success story: Rolling out medical benefits for Salesforce in India
“At the moment in India, benefits are traditionally broken into subsections. You have one benefit which is supported by one system, and another separate benefit backed by another system. We needed one system which was able to cumulatively convey the overall Employee Value Proposition – we needed a ‘one stop shop’ for benefits.”
– Pradeep Singh, Reward Lead at Salesforce India
What did we do?
We automated the administration of the plan using OneHub, saving our customer admin hours across membership management, reporting, paper-based sign up, and processing life events and changes. An online self-help system was implemented to address the queries from a population of 3,000 employees that were previously overwhelming the local HR team.
Result = 200 administration days saved
Due to the platform automation and self-serve support, direct employee queries dropped to just a few per day. This was much more manageable for the HR team and meant serious questions needing HR intervention were processed and turned around quicker and more efficiently.
Key considerations for rolling out global benefits in India
1. High medical plan complexity. While medical benefits are common globally, India’s group medical insurance plans are particularly complex. Their layered structure makes clear communication critical to avoid confusion, especially as employees may face unexpected out-of-pocket costs when customizing coverage for family members. Benefits tech can help you communicate effectively with employees to help them better understand the process.
2. The competitive talent market drives differentiation. India’s urban workforce – especially in tech and professional services – is highly mobile and selective. In this environment, standout benefits can be a differentiator, and employers should consider going beyond the basics to appeal to top talent.
3. A growing demand for supplementary pensions. While Provident Fund participation is mandatory, there is increasing appetite for voluntary retirement savings, with the NPS-Corporate Sector Model and Group Superannuation Plans gaining traction. This trend reflects a growing awareness of long-term financial wellbeing and offers an opportunity for employers to support holistic retirement planning.
4. Knowing the most popular and valued protection benefits. Indian employees place a high value on life and disability protection. Including robust protection benefits in your offering – and allowing for top-ups – supports financial security and appeals to employees’ sense of care from their employer.
5. Increasing use of Flex Funds and allowances. Organizations are moving towards greater personalization through flex funds, enabling employees to choose different levels of medical or life insurance, allocate unused funds toward wellbeing, gym memberships, or childcare and opt into additional perks like technology loans or health assessments. This shift supports the rising demand for benefit personalization while balancing cost control and choice.
To learn more about the employee benefits landscape in India, speak to one of our benefits experts.
Paul Andrews
Paul joined Benifex from Mercer in 2019 with a wealth of international benefits experience, having worked with a large number of high-profile, multinational clients to review their approach to global talent and reward. He leads Benifex’s global benefits delivery team and he’s doing an excellent job of it, if we may say so ourselves. He is skilled in international risk assessment and management, legislative compliance, trend research, cross-border claims, and customer relationship management.
04.03.25
