Is there a Penalty if Married Couples file for Separate Health Insurance?

We usually hear that married couples have the same insurance policy, but that’s not always possible. Many new couples who say “I DO” get combined with health insurance companies without thinking. It is essential to know that spouses have at least two months after marriage to buy or switch healthcare plans.

It might seem counterintuitive to keep your health insurance policy status as single because most people assume that health insurance plans for family saves money. That’s not the case every time. Like every coin has two sides, there are some drawbacks to filing a separate health insurance policy.

If you are a regular taxpayer, you will understand that one of the most significant disadvantages a married couple can face is that there are various credits that neither of you can claim when filing separately. Remember, there is no penalty for a couple filing separate insurance plans, although they face some drawbacks.

Disadvantages of Filing a Separate Insurance

Married couples file separate insurance policies because of several reasons. One of the main drawbacks of an individual insurance plan is that it is challenging to keep track of the plan, and the total exposure is higher than the plan followed by the whole family. Some of the other disadvantages of filing separate health insurance policies by spouses are given below.

  • You cannot get the child tax credit while getting separate insurance plans.
  • Adoption credit.
  • Earned income credit
  • You cannot access all the credits and deductions of every kind concerning health and education like lifetime learning credits.
  • Reporting deductions become very difficult when it comes to married filing separately.

When you start your new journey after marriage, buying health insurance is a wise decision to live a healthy life together. 

Why is Health Insurance Important for Couples?

Today, getting health insurance is a must thing to do, especially for couples due to the rising cost of healthcare and evident need for healthcare. When you are married and have children together, healthcare becomes increasingly expensive and challenging for the family to quickly arrange for large amounts of money required for treatment. That’s why it is essential to get health insurance as a family, not individually. 

Suppose you are newly married and planning to have a child. In that case, the first steps to look for are the best family health plans and maternity cover under health insurance that is extremely important during and even after pregnancy. 

Suppose you have a joint health insurance policy instead of a separate one. In that case, you don’t have to take tension about the bills of hospitalization and other ancillary expenses rising with every passing year.

🡺 READ MORE: The Average Cost of Health Insurance for a Family of 4.

Things to Avoid when Filing Separately

Several insurance companies are working in the market with claims of being the right provider for you. Before reaching any decision, there are some factors you should oversee to avoid any hustle; such as if your existing joint health plans with your family are robust to include your partner, then getting a separate health insurance policy is pointless.

If your spouse is on the board with you to have kids in a few years, consider having health insurance that benefits both of you. If you don’t have deep knowledge about insurance plans, consult with a professional insurance provider to get the decision right.