What distinguishes individual health insurance from group health insurance?

Individual health insurance is distinguished from group health insurance primarily based on the purchasing structure. Individual insurance is purchased by a single person who directly selects and pays for their own coverage, giving them the flexibility to choose tailored plans that suit their specific health needs and circumstances. In contrast, group health insurance is typically provided by an employer or organization, and is available to a group of people, such as employees of a company. This means that the coverage can be more standardized and offered at potentially lower rates due to the collective bargaining power of the group as a whole.

The implications of this distinction are significant; while individual policies allow for customization based on personal health requirements, group policies often come with benefits like lower premiums, which might limit the range of options available compared to an individually tailored plan. Therefore, understanding this core difference helps clarify how health insurance options are structured and what choices are available to consumers in the marketplace.