5 Tips for Finding Affordable Self Employed Health Insurance

Updated on September 7, 2020

Nearly 16 million Americans are self employed.

Thousands of people leave their regular jobs each year to employ themselves. Do you know why? It is because self employment is rewarding. 

As your own boss, you can do what you like while still making money. 

However, there are critical decisions that you must make to secure your finances, protect your business, and maximize the self employment perks. Self employed health insurance is one of the vital considerations that you should observe. 

Since you don’t have a regular job, you should plan for the unexpected to avoid straining your business finances. But where do you start? Which health insurance options do you choose?

As a young entrepreneur, it’s normal to be overwhelmed by the available health insurance options. If you are in this situation right now, read on to know the best covers to take and the best tips to follow.

Health Insurance Options for Self Employed People

Here are the common health insurance options for the self employed people. Go through them carefully to choose the best choice for your needs.

Family-Member Health Insurance Coverage

You can enjoy the health care coverage benefits of one of your family members. That person could be your spouse, your partner, or a parent. You can only enjoy the benefits if they have a permanent job with healthcare benefits, and they have listed you in the plan.

Note that your parent can only cover you if you are less than 26 years old. 

Health Insurance Marketplaces

Every state has online health insurance marketplaces. The marketplaces help freelancers and self employed people compare the available insurance plans in their states.  

One healthcare marketplace that you can consider is healthcare.gov, which directs people to the most affordable insurance marketplaces. All marketplaces provide basic preventive care such as vaccines and tests. 

Organization Health Insurance Coverage

Many trade organizations provide health care insurance to their members. These professional organizations include the Affiliated Workers Association (AWA), which boasts of more than 70,000 members. Other organizations include the Association of Computing Machinery (ACM), freelancers unions, and so on. 

These organizations may not give you a hefty compensation package, but they help you get the basic medical care. Find out the qualifications of these groups and join if you are interested.

Tips for Choosing the Best Self Employed Health Insurance

Health care insurance is an important life decision. It can drain your finances if you choose the wrong coverage. Here are helpful tricks for choosing the most affordable health insurance for the self employed.

1. Start Young

Don’t wait to become an established entrepreneur to apply for health insurance. The health insurance premiums depend on the riskiness of the insured and age is a risk factor. If you are more than 40 years old, the insurer considers you risky and may ask for higher premiums.

So find out the right health insurance firms in your state immediately when you are still young.

2. Manage Your Finances

Manage your cash well to secure the most affordable deals. During your search, you will meet many insurance firms with each promising lucrative terms. Unless you have a good budget, you will easily get trapped in an expensive insurance cover which will strain your finances.

Don’t settle for any insurance firm without calculating the amount of payments you will be making. If possible, compare what different insurance firms offer and choose the most affordable option. Do not rush in making decisions.

Be sure to compare the amounts of premiums versus the expected coverage. Also, ensure that your business income is enough for the premium payments. 

3. Get Expert Advice from an Insurance Agent

Insurance experts help entrepreneurs choose the best health insurance companies. These agents are independent, meaning that they don’t promote any insurance firm. They only provide helpful advice according to the current condition of the entrepreneur.

You can find independent agents on both online and offline sources. However, you should do your due diligence to confirm the authenticity of the agent you want to hire. The right agent should be reputable, transparent, and knowledgeable.

They should also give you a list of the most affordable health insurers to help you make an informed decision.

4. Open a Health Savings Account (HSA)

HSA is an affordable health insurance method. Unlike normal health insurance programs, the HSA does not include tax payments. This means that the amount you save on your account is not taxed; thus, there are no deductibles.

This savings account works well for entrepreneurs with an incredible saving discipline. 

You should make the payments consistently by following the terms and conditions for the savings. You can rely on it alone, or combine it with another health insurance plan. Find out how the health savings accounts work in your state, and enroll to cut the cost of paying an insurance firm.

5. Consider the COBRA Coverage

COBRA is a health insurance plan for people who are leaving their regular jobs for self employment. The coverage requires your employer to extend the health benefits to you for a specified period. It is a short-term solution that can help you enjoy health protection as you establish your business.

COBRA can cover you for a maximum of 18 months only. After that, you should move on to your new health insurance cover which you have initiated during those 18 months. 

Note that the payments might be slightly higher compared to what you were paying your employer. Nevertheless, it can be a great stepping stone for you to establish your business and secure reliable permanent insurers. Before you agree to it, confirm that your prevision employer is okay with it.

Make Self Employment More Certain and Profitable

Self employment is rewarding and risky at the same time. But with affordable self employed health insurance, you can manage your monthly finances well and protect your business too. 

If you do not have any health insurance cover, make the right preparations to apply for it. Follow the above tips too to save money and get the best of it. 

Found the article useful? Read the rest of the articles on our website. Our online publication reports trends, news, and the issues which affect the health care industry. 

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