Family Health Insurance

Splitting Family Members Onto Separate Individual Plans

The monthly premiums for individual family plans are determined differently than group insurance premiums. Factors such as age, smoking, weight, pre-existing medical conditions and gender can determine the final rate of your family health plan. Some insurance companies may even break rates into groups, depending on which family members you want to insure. Here are the most common rating groups:

• Subscriber Only (Includes Child Only)
• Subscriber & Spouse
• Subscriber & Child
• Subscriber & Children
• Family

Advantages With Age Discrepancies

For Subscribe & Spouse and Family rates, the age of the youngest adult is often used as the basis for determining the premium. Since health insurance rates increase with age, this is advantageous when there is a significant age discrepancy between husband and wife. Many insurance companies group rates in 5 year blocks, such as 19-24, 25-29, 30-34, etc. Anytime the husband and wife fall into different age blocks, there is a premium benefit when the insurance company calculates rates based on the age of the youngest spouse. In this situation, it is almost always best to request that the husband and wife be insured under the same policy and it may reduce your monthly premium if you insure your child under a separate policy to avoid paying the family rate.

Only One Child in the Family

The most common scenario that would warrant obtaining two separate individual policies for your family is when there is only one child in the family. You will want to look at the rates for "Subscriber & Spouse" plus "Child Only" to determine if there is a reduction in total premium by splitting coverage in this manner. If the parents are in the same age band, you can also split coverage by obtaining one policy for "Subscriber & Child" and a second for "Subscriber Only." If the parents are not in the same age band, you will lose the benefit of the lower premium of the youngest spouse by putting the adults on separate policies. Before splitting your three family members on to two separate policies, make sure that you are not increasing your total family out-of-pocket maximum by doing so (see "Consider Your Out-of-Pocket Maximums" on the previous page for more information on family out-of-pocket maximums).

Find Out How An Insurance Company Calculates Rates

Some insurance companies will calculate your total family premium by calculating the rate for each family member separately, and then adding them all together for the total. If an insurance company calculates family rates using this method, there is never an advantage to splitting coverage. To determine which method is used by an insurance company that you are considering, request a rate booklet or rate calculation worksheet from the insurance company or your insurance agent.

Note: The information and advice provided in this Guide to Family Health Insurance may not provide the best advice for every situation. The best options for your family's medical insurance may be unique and require the advice of a local advisor. We highly recommend that you consult with more than one insurance broker in your state to gather and compare alternative opinions. The owners of HealthInsuranceFinders.com are not responsible for any decisions you make in regards to your family's health insurance through the information provided in this guide.