Curve Curve
Paying too much for Cobra?

COBRA is an acronym for Consolidated Omnibus Budget Reconciliation Act, a form of supplemental insurance that are bought by people between jobs or when they are otherwise without health cover. Other buyers of COBRA insurance are people with disabilities and recent retirees. This policy typically covers the spouse and children of the beneficiary. Nowadays almost exclusively, it describes the health benefits of the 1986 law which is how COBRA morphed into COBRA insurance.

Most companies provide health care coverage and pay at least some part of the cost of coverage as mandated by national law. So when a person is in employment the cost of health insurance is far less than when the person is paying for COBRA insurance where all the costs have to be borne personally. Similarly, if an individual worked for a company which offered COBRA insurance, the coverage would have been at group rates which would have been extended to individuals. An employee fresh out of a job might discover health care costs escalating sharply but this would still be less at the group rate than at an individual rate.

COBRA insurance packages include doctor and hospital care, both as an inpatient and an outpatient. However, not generally included are surgery, extended-stay care, medical and dental needs and prescription drugs. COBRA insurance is offered by various providers. The law stipulates the basics of minimum coverage but some providers offer users more than the stipulated minimum. COBRA is good only for 18-36 months, but a beneficiary is eligible to convert COBRA insurance to a permanent individual plan for just 20% over the preferred rate.

Many consumers are unaware that there are alternative health insurance options to COBRA in case COBRA is beyond one's budget. With a little research a consumer can find a more affordable individual or family health insurance plan which is more in keeping with ones needs.

A user may be denied coverage because of a pre-existing medical condition but with COBRA one cannot be denied coverage based on medical history. In such a circumstance though COBRA is expensive it is well worth the additional expense. But if an individual is relatively healthy and not pregnant at the time, it is a good idea to look for other health insurance options which could save you hundreds of dollars a month on health insurance.

Insurance by Allied Brokers of Palo Alto, Ca handle all types of insurance including life and health insurance coverage. As each individual's circumstances vary, Insurance by Allied Brokers will advise of the options available to COBRA, with the applicable costs. For health insurance as an alternative to COBRA and all other insurance needs, please contact Insurance by Allied Brokers through their website Insurance by Allied Brokers may be contacted on phone (650) 328-1000, fax (650) 324-1142 or on email at You can also contact them using their Online Contact Form.

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