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What Are Individual Benefits - and When Do You Need Them?

Updated: Apr 20, 2023

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Disclaimer: Informational statements regarding insurance coverage are for general description purposes only. These statements do not amend, modify or supplement any insurance policy. This website does not make any representations that coverage does or does not exist for any particular claim or loss, or type of claim or loss, under any policy. Whether coverage exists or does not exist for any particular claim or loss under any policy depends on the facts and circumstances involved in the claim or loss and all applicable policy wording.

From life insurance to long-term care insurance and everything in between, it's important to consider what kind of policies and individual benefits you need.

If you're self-employed or in search of a supplemental policy to cover what your employer-sponsored plan does not, you might be wondering whether pursuing coverage as an individual is a smart choice. Yes - it is!

There's no such thing as having too much insurance. You never know what life is going to throw your way!

Of course, there are situations in which paying for coverage might wind up being more expensive than it's worth, so it's important to understand which individual benefits you need - and which you can skip.

In this post, we'll break things down for you.

What is Individual Insurance?

Individual insurance is a plan, often a medical or health-related plan, that covers a single employee. This is generally paired with an option to add coverage for eligible family members of the employee so that they can receive benefits as well.

Starting a search for individual benefits is a good idea for people who may not be able to get coverage for various things like vision or dental needs. You might want to pursue individual insurance if you are:

  • Self-employed

  • Unemployed

  • Working as a contractor or freelancer

  • Looking for benefits not offered by your employer-sponsored plans (or looking for lower premiums)

You can tailor an individual policy to your needs and budget. The biggest benefit of pursuing this kind of policy, as opposed to the coverage offered by your employer, is that you can shop around for your ideal provider rather than being forced to settle for whatever benefits your employer offers in its sponsored plans.

It isn't common for individuals to pursue individual insurance if their employer already offers a plan. That's because employer-sponsored plans tend to be much more affordable than individual insurance since businesses typically qualify for group discounts.

Health Insurance

Health insurance can cover you, the insured, as well as any eligible dependents. In addition to doctors' visits, your health coverage can also be used to pay for hospital visits and prescription medications.

With the passing of the Affordable Care Act, individuals can no longer purchase health insurance at any given time of the year. Instead, you must buy insurance during the period of the year known as "open enrollment." These open enrollment periods vary depending on the state. In some cases, certain “qualifying events” like getting married or having a child make it possible for you to apply for insurance at other times outside of the open enrollment period.

Again, if you already have a job and your employer offers health insurance, it's best to pursue this option first. Group health insurance coverage will generally be cheaper and it starts immediately, while individual insurance requires more planning.

Medicare Insurance

Medicare insurance is a specific type of health insurance that is meant specifically for individuals who are 65 years or older as well as those with end-stage renal disease. Policies are often granted to younger individuals with disabilities, too. A federal plan, it is subsidized and highly affordable.

There are various types of Medicare insurance, too. These include Part A (which covers hospital stays), Part B (general medical insurance for outpatient care and preventive services ), and Part D (which is for prescription drugs).

To complicate things even further, there is a Part C - but it's more of an ancillary alternative to original Medicare and is offered by private companies who are approved by Medicare.

*For more information or questions you may have regarding Medicare Advantage, Medicare Supplement or Stand-Alone Part D Plan enrollment, coverages or to make an appointment to discuss Medicare coverage in general, contact Kristi Johnson at or call 518-561-7000 Ext. 155

*Disclaimer: Calling the number above will direct you to a licensed sales agent.

Vision Coverage

Vision insurance is one of the most common types of individual benefits. That's because many employer-sponsored medical plans do not include vision benefits as a core component - many offer it as a voluntary benefit instead (we’ll tell you more about this later).

While it's not necessary for everyone, purchasing individual benefits for vision is a good idea. These plans can provide you with discounted rates on contacts, eyeglasses, annual eye exams, and more.

Many employers offer vision insurance as a voluntary benefit but if not, you can buy it through the marketplace just as you would purchase individual benefits for other health care needs.

Dental Coverage

As with vision insurance, dental isn't always a core component of employer-sponsored health plans. If you have a family, pursuing individual dental benefits is a good idea. All of those check-up costs can really add up over time!

Again, most employers offer dental benefits as a voluntary benefit but you can also buy a full-coverage dental plan on your own.

Long-Term and Short-Term Disability Income Insurance

Disability income insurance is intended to provide financial compensation in the event that you are injured and unable to work. As the names imply, the time period in which you are out of work and can receive benefits varies.

Long-term disability benefits generally offer benefits for up to ten years (if not all the way through to your retirement) while short-term lasts somewhere around 13 to 26 weeks, though policies vary.

These kinds of policies are meant to provide coverage to employees who are out of work for two weeks or more and can replace up to 70% of your total income during the benefit period, depending on the specifics of the plan.

Employers may offer their own plans for disability benefits. However, you can also shop around for other plans that will help you in the event of serious illness or injury.

Life Insurance

Life insurance provides a substantial financial payout to your beneficiary (or beneficiaries) in the event of your death. Though somewhat macabre to think about, life insurance is a must-have if you have a family (especially if you are the sole or primary breadwinner).

There are several types of these policies to consider, including term (which provides coverage for a specified time period, such as 10 to 20 years) and whole life (which guarantees coverage for your entire lifetime as long as you continue to pay the premiums when they are due).

Term Life Insurance

The simplest form of life insurance. You purchase coverage for a specific price for a specified period. If you die during that time, your beneficiary receives the value of the policy. There is no investment component.

Whole Life Insurance

The policy covers your “whole life”, not just a set period. Premiums remain level throughout the life of the policy, and the company invests at least a portion of your premiums. Some firms share investment proceeds with policyholders in the form of a dividend. Many companies will offer “a relatively low guaranteed rate of return”, but in reality pay at a rate in excess of the guarantee.

Universal Life Insurance

You decide how much you want to put in over and above a minimum premium. The company chooses the investment vehicle, which is generally restricted to bonds and mortgages. The investment and the returns go into a cash-value account, which you can use against premiums or allow to build. There are generally two types of Universal Life policies. With Type I or Type A, the cash account goes toward the face value of the policy on the death of the policyholder. With a second variety, sometimes called Type II or Type B, the beneficiary receives the face value of the policy plus all or most of the cash account. While Type II is meant to provide a partial hedge against inflation, it demands higher premiums than Type I as you get older.

Variable Life Insurance

With a variable life policy, there is usually a wider selection of investment products, including stock funds. As with a universal policy, returns on investments can offset the cost of premiums or build in the account. Depending on the type of policy, the beneficiaries will either receive the face value of the policy or the face value plus all or part of the cash account.

Long-Term Care Insurance

Long-term care insurance covers your costs should you need to be put in a nursing home or assisted living facility. It can also cover expenses accrued for in-home care. For example, there may come a time when you need help getting dressed, eating or bathing. It may also include the kind of care you would need if you have a severe cognitive impairment like Alzheimer’s Disease. With most policies, you can receive this care in a variety of settings, including your home, an assisted living facility or a nursing home.

Most plans let you select the amount of coverage you want, as well as how and where you want to use your benefits. A comprehensive plan includes benefits for all levels of care, from custodial to skilled.

Premiums for these policies can be expensive and most financial experts recommend waiting to shop until you're in your 50's or 60's - but don't wait too long, or premiums will be much higher.

Final Expenses Insurance

Final expense insurance is a limited kind of life insurance coverage that provides funds for medical bills, burials, and funeral expenses - the kinds of expenses that one would consider to be your "final expenses."

It might not be the kind of thing you want to think about, but if you want your loved ones to truly be taken care of (and all of your funeral costs covered) after you die, it's something you should consider getting.

What are Voluntary Benefits?

Hopefully, the list of individual benefits options listed above helped clear up some confusion over the many types of policies you can apply for. However, there is one important distinction to be made - and that has to do with voluntary benefits.

Voluntary benefits are additional insurance offerings that you can choose to add to the benefits package available at your workplace. These tend to be fully funded by the employee so there's no direct cost to the business.

At the same time, you're getting a better deal as an employee, too, since many of these plans have group discounts that you can't get if you pursue policies on your own.

Voluntary benefits packages can include any or all of the following types of coverage:

  • Short- and long-term disability insurance

  • Life insurance

  • Dental insurance

  • Vision insurance

The only difference between individual benefits and voluntary benefits is in who has to pay. While voluntary benefits are sponsored by the employer and are, therefore, generally offered at a lower cost to you, with individual insurance, the employee will generally have to shoulder most of the expense.

Should I Get Individual Benefits?

How do you know if it's time for you to search and apply for individual benefits?

Consider looking for a policy if you are self-employed or otherwise ineligible for employer-sponsored benefits. Individual benefits can be pricey, in some cases, but if you don't have other options available through your employer, they're a necessity.

It's important to shop around for the right plans - but it can be tough to know what to look for. Here at Northern Insuring, we're all about simplifying the complicated... for insurance needs of all kinds. Whether you're an independent contractor looking for coverage or just want to supplement what's offered by your full-time employer, we can help you find out about the options available.

If you want to live your life protected by individual benefits - but without all the added stress of shopping for coverage - contact us today. We'll get you up and running in no time!



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