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I am a small business owner in CA and want to know which is best: a group health insurance plan or an individual health insurance plan – which should I choose?

– Jordan B. Red Bluff, CA

Hi Jordan,

The nice thing about being a small business owner in California is that most often you have two choices for health care coverage: group or individual. In fact, you don’t even need to be a business owner because anyone is eligible to apply for an individual health plan and many have a 2nd option in their employer’s group health plan.

The bad thing is that it is often frustrating to try and decide which option will be the best choice for you and for your company. As a self employed individual there are tax benefits to each so that should not be the deciding factor (don’t fall for the tactic that an agent may use in saying that only one particular insurance company’s plan will give you the tax benefit as a self employed person and not another – this is simply not true).

Here are some pros and cons for each:

California Individual Health Insurance

PROS
• Much cheaper than group health
• Easy online applications with most CA insurance companies
• Quick applications and approval process

CONS
• No guaranteed acceptance into plan
• Must pay extra to have maternity coverage
• Must be somewhat healthy to be approved for coverage

California Group Health Insurance

PROS
• Guaranteed acceptance into plan
• Most plans cover maternity automatically
• Can receive health care even with prior major health problems

CONS
• Much more expensive than individual health
• Limited time frames to enroll into plan
• Usually must be a full time worker to be eligible for coverage

Most small business owners that are looking for the best plan from a cost perspective will choose a California individual health insurance plan because of the much cheaper monthly premiums. One smart thing that you could potentially do is to set up a medical reimbursement plan for your company so that you can enjoy the cheaper premiums of individual health insurance and still provide tax deductible (to the company) employee benefits to employees in the form of reimbursements for employee premium dollars spent.

Take a few moments and use our free quote finder to compare all of the top plans from the top California insurance companies that offer coverage in your zip code. Get free California health insurance quotes now!

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