Should You Opt for COBRA or Buy Individual Health Insurance

Whether you left your job voluntarily or got ejected out due to the economy, maintaining health insurance coverage for you and your family should be one of your top concerns. Even if you are flat broke, you cannot afford to go without health care coverage. All it will take is one nasty flu season or a serious accident to make a bad situation even worse. Choosing the best type of insurance for your family is just as important as deciding to keep it. Is it better to sign up for COBRA or should you go ahead and buy individual health insurance?

COBRA requires employers to allow you to stay on their health coverage for up to 18 months after you have stopped working for them. For most families, this coverage acts as a safety net that covers them until they are able to sign up for different coverage. Individual health insurance, on the other hand, is private insurance that you purchase directly from the insurance company. As long as you keep paying the premiums, you will always be covered whether you are employed or not.

It is hard to say if individual health insurance is better than COBRA, or vice versa, because each person's situation is unique and both types of insurance have benefits and disadvantages. Under COBRA, you will keep the same exact coverage you had under your employer. The difference is that now you are responsible for the full cost of the insurance whereas before your employer covered 50-100% of the premium. This can get quite expensive and you will be unable to change your insurance plan to something that costs less. Additionally, the coverage is only available for a limited time.

Often times you are able to customize your individual health insurance policy to get what you need which can result in lower premiums than COBRA would be. And, as mentioned before, as long as you pay the premiums you will continue to be covered for the rest of your life. The disadvantage of this option is that you may not be able to secure insurance if you have a preexisting condition. This, of course, depends on the type of preexisting condition you have but it is quite possible that you would end up being rejected outright or spending more on your insurance than you would with a COBRA policy. To determine the best option for health coverage for you the advice of a professional health insurance agent should be sought to help you find a plan that meets your specific needs.