What Is The Difference Between Individual And Group Health Insurance?
When shopping for health insurance, you will find that there are two basic options: group insurance and individual insurance. Knowing the differences between the two types of coverage will help you choose the best possible coverage for which you are eligible.
Group health insurance is the type of insurance offered by employers. Most people have this type of insurance coverage. Because employers have a lot of people that they are going to be covering with their policies, they can get better rates on the insurance policies. Even if you have to pay your premiums, getting on a group insurance plan is likely going to be the most affordable option if it is available. In many situations your employer will pay at least a portion of your premium, making it even more affordable.
Individual insurance, on the other hand, is insurance you buy for yourself and your dependents. Because you are the only family being insured, this type of insurance will cost more. Individual insurance plans are usually used by those who are self-employed or not working for a company that offers a group plan. You may choose to purchase an individual insurance plan to make up for a lack of coverage in your group plan as well. Individual policies can be used to span times of unemployment when group plans are not available. In order to qualify for an individual insurance plan, you will likely have to take a physical exam or answer health questions. If you are in poor health or are overweight, you will find that the premiums increase.
You may also find that the out-of-pocket expenses are greater with individual insurance. This occurs because the insurance premiums are so expensive. In order to make the premiums affordable, deductibles and co-pays are often increased. Because premiums on group policies are more affordable, the out-of-pocket expenses can be lowered. However, individual insurance is a better option than carrying no insurance coverage, as you never know when a catastrophic event may occur.