Individual Health Insurance Pros and Cons

Many people ask, what is the difference between Individual Health Insurance and Group Health Insurance? With Individual Health Insurance, you choose and purchase the policy directly with the insurance company. You own the policy. With Group Health Insurance someone else chooses what is best for you and they own the policy. The group is the master insured and owns the policy. Participating members of the group are issued insurance certificates, not a policy.

What are some of the pros and cons with Individual and Group Health Insurance? With Individual Health Insurance an insurer may decline coverage on the basis of the applicant's medical history. The insurer may also issue a policy with limitations on coverage for pre-existing conditions. On the other hand most Group Health Insurance is issued even with pre-existing medical conditions. All the pre-existing medical conditions are balanced with those in good health within the group and priced accordingly. If the group has a lot of unhealthy or older people, the rate will reflect this, but be split between everyone. Most employers today do not pick up all the cost of health insurance for their employees and family's, but split the cost with them. Risk to the insurer is also balanced by the size of the group.

There is a major advantage to Individual Health Insurance, it is yours! If you have group coverage, that policy can be canceled or changed by your employer at anytime. This is a major problem with Health Insurance today. People change jobs and cannot keep their Health Insurance because it is was not theirs to start with. With Individual Health Insurance you can change jobs and you keep your insurance because it is yours. Another major advantage to Individual Health Insurance is that you can choose the type of coverage you want, rather than what an employer wants. Group coverage is a one-size-fits all, but with individual health insurance you can customized you coverage to fit your needs. Also with Individual Health Insurance in the state of Texas, the insurance company cannot cancel your policy unless you do not make the payments or they find out that fraud was committed on the application.

Individual PPO Health Insurance (Preferred Provider Organization). This is the most popular type of plans today. With this type of plan you can see any doctor or specialist you want. Doctors and hospitals in the network give you discounted prices. Doctors outside the network do not get this discount. However, most doctors are in network for all the major carriers (Aetna, Assurant, Blue Cross Blue Shield, Humana and United Health One).

Individual HMO Health Insurance (Health Maintenance Organization). HMOs have a network of doctors, specialists and hospitals that you must go to. The popularity of HMOs has fallen off due to their restrictions, but they still are an option.

For selecting an Individual Health Insurance Plan please see our page on "Health Insurance Tips".