Employers have to generally provide health insurance for their employees. There are often two routes to doing this: opting for group health insurance or individual health insurance. What is the difference and how to pick the right insurance?
Health insurance is an essential component of a good, healthy life. Just like you should be eating the right foods and doing the right exercises, you also need good health insurance to protect you when things go wrong. But choosing between group health insurance and individual health insurance can be difficult. Here’s a look at what these options are about, how they compare and what you, ultimately, need to know in order to buy the right insurance coverage for you.
What is group health insurance?
Group health insurance refers to the health insurance your employer provides you with. These are selected and paid for by your employer and it’s offered to all employees who are eligible under the insurance’s terms. The cost of the premium in group health insurance is typically shared by the employer and the employee. There are numerous insurance providers that offer different types of group health insurance. What’s important to know about group insurance is that it’s the same insurance for all employees. Therefore, it’s crucial to focus on eligibility in terms of things like pre-existing conditions and so on. Even though most might be able to get coverage under group health insurance, some employees might not – it could even impact the cost of this insurance.
What is individual health insurance?
Individual health insurance is just purchased for you or your family. They can sometimes be referred to as personal health plans. You can find individual health insurance from a variety of insurance providers and there many different plans available. The plans often vary in terms of how and what is covered by the plan. Now, your employer might choose to provide individual or group health insurance. The big difference with individual health insurance is the part that it’s personal – each employee is covered with separate insurance that suits their needs.
How do the two insurance policies compare?
So, what are the different policies like in terms of comparison? There are, of course, advantages to both of the plans.
First, group health insurance has the benefit of:
- Split costs between the employer and employee.
- Your employer does all the work in finding the right insurance.
- Certain tax exemptions might apply.
However, group health insurance can sometimes come with the following downsides:
- It might not be covering enough of the things you want.
- You might end up paying for more than with individual health insurance.
- You are only covered when you’re working for the company.
But what about the individual health insurance? It can have the benefit of:
- You get to choose exactly the kind of policy you want.
- Your plan is not tied to your job so you can change jobs without losing coverage.
- You might get certain tax exemptions.
- Your family could be included in the policy.
Of course, individual health insurance isn’t without some downsides. When thinking about getting it, in terms of group insurance, you must know that:
- The initial cost might be higher.
- You have to spend a lot of time finding the right insurance.
Deciding on the right insurance takes a bit of time. You should consider your personal situation and the different pros and cons in order to find which policy might work best in your case. For example, the cost of the insurance is down to personal circumstances. Your location, income and possible pre-existing conditions can all have an impact and this is why it’s hard to make a judgment on which policy is more affordable for you.
What is the right health insurance choice?
Ultimately the choice is up to you. There isn’t really a universal answer into what health insurance is the best because circumstances will always be different from one individual and business to another. That’s why it’s important to keep your options open and research policies carefully.
By looking to understand group and individual health insurance, you’ve already started the right journey. Now that you know what both of them means, you have an idea, which might work better for your business. This allows you to start creating a personal list of pros and cons, while also exploring the different policy options online.
You then just need to start comparing different policies from different providers. You should look at the positives and the negatives, picking the policy that best matches your needs. Finding the right health insurance is not the easiest of things to do but it’s definitely worth the effort.