What is Cobra Insurance.

by: Craig Hodges
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What is Cobra Insurance?

The main feature of Cobra Insurance is that the employees who are covered under this group insurance of the employer can continue to remain a part of it even when their is a change in the status of their job. It is valid up to 18 months after the individual has been terminated or there has been a reduction in his working hours.

This insurance is meant for the individuals, their spouse as well as their dependents. In case, the employee gets disabled within the first two months of Cobra plan, his coverage will remain valid up to 29 months and if the employee dies or goes through a divorce, then the employer has to provide this coverage for the next three years to his or her spouse and dependents. A group health plan under Cobra Insurance is a plan which is meant to give medical gains to the employees of the employer and the dependents of the employee are also included in this plan. These gains are given either by the means of insurance or some other source like a health maintenance organization, reimbursement or a trust etc. The medical gains that can be utilized by the recipients of this plan are:

- Care from the physician
- Any drugs that have been prescribed by the doctor
- Care of the patient when he comes for a check up or when he is admitted in the hospital
- Other medical requirements like the dental care or the check up of eyes etc
- Surgery of any kind
- However, one feature that is not covered under Cobra Insurance is the Life Insurance.

People who can take benefit of this coverage can include an employee, his spouse, a retired employee and his spouse and his children, a new born child or a child that is being adopted by the employee will also come under the category of Cobra beneficiaries. There are certain events which can cancel the coverage of an individual and they are called as the 'Qualifying Events'. They include the termination of the employee for misconduct and a decrease in the number of hours that an employee works. A qualifying event for the spouse will include these conditions as well some other conditions like a divorce from the employee, death of the employee or if the employee's coverage is changed to MediCare.

People who pay for the Cobra coverage are usually the recipients only and under no circumstances can the premium be increased to higher than 102 percent of the plan price. Till the time the individual is working, his employer is supposed to pay the entire premium of the group health insurance, but once the individual is no longer working, he himself will have to pay the premium of the insurance plan.