cobra insurance for all

COBRA Insurance is a Law that was passed by the Congress in the year 1986. United States is the only country that offers health insurance coverage to many of the Americans. In many companies the employer takes the responsibility of the health insurance. But when there is a sudden downfall of the business and the employee is terminated from the job, what happens to his health insurance? Whether the employee loses his job or retire from the job he can choose COBRA insurance (The Consolidated Omnibus Budget Reconciliation Act). The COBRA insurance covers 18 months coverage for the employee. The only criterion is that there should be at least 20 employees. But in some States, even if there are less than 20 employees COBRA allow them to avail the insurance benefits. But in this case it is only for a period of additional six months.

The first thing one should understand is that COBRA insurance is a temporary insurance. And there are also certain rules that who are eligible to elect COBRA insurance. Even though COBRA insurance is helpful for the employee when he loses his job, this cannot be continued forever as it is temporary insurance. And in the mean time if you fall sick then you may have to spend lot of money out of your pocket. Hence it is advisable to have a permanent health insurance plan when you are healthy and fit.

According to the law, the employers have to inform their eligible employees about the available option of health insurance through COBRA insurance. The employees should give their consent to the employer. And the period for accepting the COBRA coverage is 60 days. This COBRA insurance also covers the entire family of the employee if the employer agrees to offer insurance policy to the family. The COBRA insurance is applicable to State and Central government employees too.

Normally the employer accepts to pay the entire premium of the employee in the employer’s group plan. But in case if you have left the job and the employer place your insurance under COBRA insurance then you have to pay the full premium and also an additional cost of 2% as administration fee to activate the COBRA insurance.

Whether COBRA Insurance is worthy or not? This is the frequently asked questions by many of the users in the internet. The reviews in the internet say that COBRA is a useful insurance and can be used in emergencies. But since it is temporary and restricted to limited period, healthy people are advised to choose any of the permanent health insurance plans as a precautionary measure.