How Heath Insurance Changes for Family When the Primary Dies

If you pass away as the primary for health insurance your spouse and children may be affected.

When the primary on a health insurance account dies there could be drastic changes to the coverage that that primary’s family is owed. It’s important to be aware of these possible changes so that you can make sure your family is cared for.

There are a few different ways that this can happen depending on what your insurance looks like.

Employee-sponsored Insurance

Many full-time employers nowadays offer comprehensive benefits for employees, including medical insurance. Often, spouses and children under 26 are included in those benefits. When you die, coverage provided by your insurance is terminated for family members, meaning that your spouse and depends will need to find alternate coverage after the allotted grace period.

Family members can call the HR department at your place of work for more information on the extent of that grace period and available options for new insurance. Many employer-sponsored insurance plans are able to offer up to 36 months of coverage for dependents after the death of an employee through The Consolidated Omnibus Budget Reconciliation Act (COBRA).

Keep in mind: This can be a helpful but costly option. Employers pay the majority of an employee’s insurance premium. If you’re not around as an employee with that company, the full cost of that premium falls on your spouse in order to maintain coverage.

Affordable Care Act Exchanged-Based Plans

There is another option available for spouses through the Affordable Care Act. A loss of employer-sponsored insurance qualifies spouses to sign up for a exchange plan through the special enrollment period. Spouses have a 60 day window to sign up before having to wait for open enrollment towards the end of the year.

Caring for Your Family

There are a few ways that you can ease the burden of insurance transitions on your family in your will.

Leaving a sufficient amount of money to help cover the costs finding new insurance or the costs of paying for COBRA insurance can be huge in helping the transition. This is especially true if your spouse or dependent have ongoing healthcare needs such as long-term treatment that is crucial to your family’s health.

If your spouse is employed, it can also be good to look at the healthcare benefits available through their employer. Being on separate insurances or having their insurance as a fallback for them and your dependents can also go a long way in easing the tensions of transitioning to new insurance. This also applies to adults children under the age of 26 who are still on your insurance as dependents. Preparing now can help cut costs and curb headaches later.

Published 08/17/2021.