Should your adult child remain on your health insurance?

Parents are able to continue covering their young adult children until they reach the age where they should be finished with most or all of their college education.

But should you? This post gives an overview of when it makes sense to keep our children on your policy and when it doesn’t.

Keeping your adult child on your insurance

Even if your child is employed and eligible for a plan through their own work, staying on your plan may be the most affordable option. A family plan probably has better rates than those your child would get on their own plan. You may also be eligible for tax breaks based on the amount of money withheld from your pay to contribute towards the health care plan.

Your child is opposed to being on your plan

Even if it is the most financially sound decision, your child may feel like staying on your insurance isn’t the “adult” thing to do or even be worried about their privacy while on a shared policy. Help them weigh the pros and cons of the alternatives and they may end up realizing the best choice is to stay on your plan anyhow.

Your child lives out of network coverage

If your child has moved out of your coverage area, either permanently or for college, keeping them on your plan may lead to excessive travel costs or paying out-of-pocket for immediate care. Assuming your child is healthy, an independent plan may keep costs down.

Your child is close to the age cut-off

The law allows adult children to remain on their parents’ policy until the age of 26, but some plans allow them to remain until the age of 30. Once you’re sure of your policy’s age cut-off, encourage your child to establish their own policy if they’re within a year or so of aging out.

You are close to retirement

If you are heading into retirement or even just the age where you can switch over to Medicare, it may not make sense to keep your child on your plan.

If it’s time for your child to purchase their own health insurance plan, consult with an experienced insurance broker to help them find the right coverage for their needs.