Individual Health Insurance

What Is Individual Health Insurance?

Individual health insurance provides Americans with annual medical costs coverage. From checkups to acute emergency care, insurance prevents individuals from being hit with crippling healthcare fees in the event of injury or illness.

Before the introduction of the Affordable Care Act (Obamacare) in 2010, insurance providers could deny coverage due to medical status or charge exorbitant premium fees. But, now, affordable healthcare is available to all, no matter their health status.

Individual health plans also offer ten essential benefits, including outpatient care, prescription drugs, prenatal and maternity care, hospitalization, mental health, and pediatric services.

Unless you have a qualifying life event, individual health insurance can only be purchased during the open enrollment period (November 1 and December 15 in most states).

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Understanding Individual Health Insurance Options

There are plenty of options available for individuals looking for health insurance coverage. The first and most talked-about option is the Affordable Care Act (Obamacare).

Affordable Care Act plans are available through your state insurance marketplace or via The marketplace offers a variety of different individual health insurance plans and subsidies for individuals needing help to cover health insurance costs.

Off-exchange health insurance is via your employer or through a private source, such as directly from an insurance carrier. Depending upon the plan, this could be more expensive or cheaper than buying on the marketplace.

To ensure you get the right coverage, you should carefully evaluate the costs between the two and the plans that they offer.

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Types of Individual Health Insurance

Affordable Care Act (ACA) PlansACA plans provide comprehensive coverage that prevents high healthcare expenses in the face of a medical emergency. There are different plans available to meet every individual’s healthcare needs and cover a broad range of health care services.

Short-Term Plans

Short-term plans are often selected by individuals who missed the deadline to apply for an ACA plan during the open enrollment period. Short-term health insurance is available all year-round but usually provides much less coverage and does not help you avoid any state tax penalties.

Indemnity Plans

Also known as “fee-for-service,” indemnity plans pay a predetermined amount of money for medical services received. Because the insurer’s contribution is set, individuals can visit any doctor or specialist they like.

When You Might Need Private Health Insurance

A Young Adult 26 Years of Age or Older

Young people can remain on their parent’s health insurance policy until they turn 26 years old. From this point, they must arrange their own health insurance plan.


If you lose your job, you can remain on your employer’s health insurance plan for up to 36 months through the COBRA program. However, doing so means you will have to pay the entire cost of the insurance.

A Part-Time Employee

A part-time job will rarely offer health benefits; therefore, you most likely need to enroll in your own health insurance if you have part-time hours.


A self-employed person who is a freelancer or owns their own business must provide their own health insurance.

A Business Owner With Employees

If you own a business with employees, you might be required to offer them health insurance.

If You Retire (or Your Spouse/Parent Retires)

When you or your spouse/parent whose plan you are enrolled in retire, you lose access to your employer-sponsored health insurance. If you are under 65, you will need to purchase individual private health insurance until you turn 65 and can apply for Medicare.

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Affordable Care Act/Obamacare Options For Individuals

There are different tiers or levels of coverage offered with the on-exchange or subsidy program known as Obamacare.

This individual health insurance is separated into different metals, with bronze being the lowest level of coverage and platinum being the highest. For example, bronze coverage will pay 60% of your out-of-pocket costs, and platinum will pay 90%. Of course, the individual health insurance cost will vary depending on the coverage; the more coverage you choose, the more it will cost you.

You can only apply to Obamacare during the open enrollment period, usually from November through December. Still, if you have a qualifying life event, such as divorce or the death of a partner, you may be able to get coverage as soon as two weeks after applying.

Off-Exchange Health Insurance Options For Individuals

Off-exchange health insurance is available through employers or by directly contacting an insurance carrier without using the marketplace. Enrolling in a health insurance plan off-exchange means you will be unable to receive any subsidies.

You can purchase insurance for maternity care, disability, a high deductible catastrophic plan, and other plans that will fit your needs and budget.

Whether you directly look for coverage through different carriers or you have a job that offers individual health insurance, prices will vary. An employer-sponsored plan will likely be much less expensive as they pay a portion of the costs.

Remember that your employer may have an open enrollment period that you need to enroll in during a designated time.

Self-Employed Health Insurance

To a newly positioned self-employed person, finding health insurance can be a daunting task after having the benefits previously organized by your employer. Thankfully, if you have chosen to become self-employed, finding health insurance is an easy task.

The state/federal marketplace has a range of coverage options for self-employed persons. Affordable premiums are available for independent contractors, consultants, freelancers, and other types of independent contractors with zero employees.

If you leave a job with coverage under a group health insurance plan, it may be possible to temporarily stay on your employer’s health insurance with COBRA.

Aside from the usual Medicaid and private health insurance options, self-employed people should also consider joining special groups such as The National Association for Self-Employed and The Freelancer’s Union.

Certain groups provide members with medical insurance for self-employed.

Individual Health Insurance Is Essential

Until recently, health care insurance in the US was mandatory. But from 2019, there is no requirement for the public to obtain health insurance. Although there are no penalties, it is still highly recommended to avoid the possibility of high medical bills in the event of injury or illness.

It’s impossible to predict when you’ll need medical attention, and even something like a small broken bone can have significant financial consequences without insurance.

How to Buy Individual Health Insurance

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Choosing a Health Plan

When buying individual health insurance, the first thing you need to do is assess your needs, review available options, and choose a plan that matches your finances and health. Some health care options available to individuals:

  • Employer coverage: Enroll in your employer’s health insurance plan.
  • Individual health insurance: This is a plan you buy from your state’s health insurance marketplace.
  • Medicaid and the Children’s Health Insurance Program (CHIP): Two federal-state programs that provide healthcare for individuals with low-income.
  • Medicare: For individuals age 65 and over and those with certain physical limitations under 65.
  • Short-term insurance: Temporary coverage is often used to bridge the gap before the next open enrollment period.

Do Your Research Before Open Enrollment

Individual health plans that meet government standards are only available during the annual open enrollment period (November 1 to December 15 in most states). This makes it extra important to research options and apply ahead of time. Leaving it all until the last minute could leave you low on options and without coverage.

Check Health Plans in Your State Marketplace

Health plans sold in the marketplace are divided into Bronze, Silver, Gold, and Platinum categories. Bronze plans provide the least expensive premium, and platinum plans are the most expensive but have more extensive coverage and come with lower out-of-pocket costs.

Suppose your income qualifies you for discounts or lower out-of-pocket costs. In that case, you can fill out the application to see if you’re eligible for assistance and to compare health plans from private insurance companies in your area.

Look at Health Insurance Companies Outside the Marketplace

Health plans are available directly from insurers without using a marketplace. These plans are also categorized by metal tiers (Bronze, Silver, Gold, and Platinum) and still offer the same minimum benefits. However, by enrolling in a health plan outside the marketplace, it is not possible to qualify for tax credits or subsidies.

Understand and Compare How Health Plans Are Structured

There are several variations of individual health insurance plans you should be aware of.

  • An HMO (Humanization Maintenance Organization) provides enrollees with coverage through a specific network of healthcare providers. These plans are more affordable, but patients must use specific doctors and specialists to cover the costs.
  • A PPO (Preferred provider organization) gives enrollees flexibility to see healthcare providers outside the network, but the rates will be more expensive.
  • A POS plan is a little of both. It operates like an HMO if you stay within the network but allows you to use out-of-network doctors. Typically a POS plan requires you to get a referral to see a doctor outside of the network.
  • An HDHP (High-Deductible Health Plan) has a higher deductible by typically lower premiums than other plans. This makes it ideal for young and healthy people who are unlikely to need medical care.

Best Health Insurance Companies for 2023

The best individual health insurance providers offer a blend of fast claim processing, flexible options, affordable premiums, and responsive customer service.

Our specialists will provide you with a breakdown of plans available from the best health insurance companies.

The Bottom Line

For some, arranging their health insurance plan isn’t as simple as signing up for their employer’s plan. But once you’re aware of your different options and have a specialist advisor like Coverage Haven by your side, finding a health insurance plan that matches your needs and budget is easy.

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