If the soldier has 100 % health - the bar is green.
If 70- 100 % health - yellow.
If 40- 70 % health - orange.
If below 40 % - the bar is red.
Why is it important ? Because sometimes the player is focused on shooting and orders the bots to stay in cover. But - they are slow and stupid and in few seconds they all can get killed.
Of course - the attentive player will see the skulls, but usually it is just too late to save the squad.
Besides - the player (as an officer / squad leader) should know the health of their soldiers.
I like the idea; however, a simpler bar that goes up and down would be much better. Many people are “red/green” colorblind. I can’t remember the exact number, but it’s fairly high. I wish game developers would take this into consideration during development.
I can only see a difference of the colours proposed in the screenshot, when I am concentrating myself on it for a while. So yes you are right, a simple bar would be better instead of coloroptions.