Self-Employed Health Insurance: Everything You Need To Know

Self-Employed Health Insurance: Everything You Need To Know

When a company employs you, they’ll often provide health insurance, among other benefits. However, you’ll have to purchase health coverage when you’re self-employed. Insurance can be difficult to understand, and so many options exist. If you are self-employed and want to be free to live and work anywhere then a Connect plan from Insured Nomads is the solution.

Doing thorough research is very important; this will help ensure that you pick a health insurance plan that suits your unique needs. Read on to learn about all the health resources available to you as a self-employed individual. If you want to speak to one of us about our plans, chat with us or send us a message from the bottom corner of this page.

What Does It Mean To Be Self-Employed?

A self-employed person does not work for a company that pays a regular salary or hourly wage. They earn their money by offering their services freelance or contract basis and typically set their hours. They also tend to market their skills in a particular niche, like legal services.

Usually, independent contractors receive the gross amount of the money they earn, meaning they have to set aside funds for tax season on their own. However, some businesses will offer independent contractors the option to have taxes withheld.

Common fields of work for self-employed people include writing, design, freelancing, investing and trading, and sales. They don’t just offer their services to businesses on a freelance or contract basis but often start personal brands, build companies from the ground up, and hire employees.

How Are Health Insurance Premiums Priced?

Monthly premiums on health plans can be quite expensive, especially when you’re self-employed. Some factors that insurance companies use to determine how much a person will pay on their premium include:

  • Age
  • State of residence
  • Tobacco use

Insurance companies cannot factor your health, medical history, or gender when determining your rate.

Factors Insurance Companies Consider

  • Where you live
  • Your age
  • Who needs healthcare coverage?
  • Do you smoke tobacco?
  • How much coverage do you want?

There are five factors insurance companies are allowed to consider under the law.

Where You Live

Your residence factors into the cost of your health insurance coverage. If you live in a big city where the cost of living is high (ex: New York City), and there are many insurance companies to choose from, you’ll likely have more affordable health insurance.

When people have many healthcare options, insurance companies fight against each other to offer the most competitive rates. However, in areas with limited healthcare options, insurance companies will often charge a higher than average premium because they know people will have to pay if they want access to quality providers without spending a ton in out-of-pocket costs.

Your state and local laws can also have an impact on your premium. Some states even have something called an individual mandate. If you do not have health coverage in one of those states, you’ll have to pay the penalty on your income tax return.

Your Age

Older citizens can pay up to three times more on their premiums than their younger counterparts. Younger people pay less because they typically need less medical care and are less likely to need ongoing treatment for pre-existing conditions.

Eight states (including Washington D.C.) don’t abide by the federal laws when calculating rates. In New York and Vermont, age isn’t considered a factor. The other six states: Alabama, Massachusetts, Minnesota, Mississippi, Oregon, and Utah, use different methods to determine rates.

Who Needs the Health Care Coverage?

Individual plans are typically much more cost-effective than plans that also cover a significant other or dependents. Individual coverage is best for people who are single with no dependents.

If you are married and have children with your spouse, you’ll save more money by purchasing a family plan. Buying your family’s health plan will cost more than having everyone under one health insurance policy.

Do You Smoke Tobacco?

People who smoke tobacco tend to have higher monthly premiums than those who don’t. Those who are regular smokers or who have smoked tobacco within the last year could have this factored into their rate.

The Kaiser Family Foundation data shows smokers’ premiums can be up to 50% higher than the average individual seeking coverage.

It’s important to be honest about your tobacco use because if you aren’t, you could be guilty of insurance fraud. This is considered a misdemeanor and punishable through community service, probation, or even jail time.

You will probably lose your health coverage and pay a fine to account for the insurance company’s loss.

There are a few ways a health insurance company could find out you’re being untruthful about your tobacco use. One example is when they’re reviewing your case to determine if a particular treatment is covered under your plan.

Your provider has likely indicated in their records that you are a smoker based on results from routine blood work or other tests.

How Much Coverage Do You Want?

Other factors that will determine how much you spend on a health insurance plan are the coverage you select, how much you’re paying in out-of-pocket costs, and how much you’re willing to spend on your deductible.

Levels of Coverage

Every health insurance company has different coverage options for consumers to choose from. The coverage you choose will determine how much you spend each month.

According to the Affordable Care Act, there are four categories that a health insurance plan can be classified — bronze, silver, gold, or platinum.

  • Bronze. A bronze plan is great for people with no pre-existing conditions requiring frequent treatment and those who rarely visit their primary care physician outside of a standard check-up. Monthly premiums are low, but deductibles tend to be very high, so preventative care would be quite expensive under this plan.
  • Silver. A silver plan is great for people who see the doctor more often than just the occasional check-up but don’t have any conditions that require regular treatment. Those who benefit most from this plan see their doctor for headaches or runny noses. You’ll pay more monthly on your premium than on the bronze plan, but your out-of-pocket medical expenses will be lower.
  • Gold. The gold plan will cost you a decent amount each month, but you’ll save even more on out-of-pocket medical costs. If you have a pre-existing medical condition or another condition that requires you to visit your doctor often, you’ll get the most value for your money with a gold plan.
  • Platinum. The platinum plan offers the most coverage and is best for people with more than one medical condition requiring regular care. A platinum plan would be the best option for those with high medical expenses due to multiple pre-existing conditions. While it has the highest monthly payment, your deductible will be lower than any other health plan. The platinum coverage will also often cover most, if not all, of your treatment costs.

As you can see, several health insurance options are available, and the level of coverage you select will depend on the specific needs of you and your family. It’s a good idea to do plenty of research before the open enrollment period, so you know which plan you want to purchase ahead of time.

Out-of-Pocket Costs

Another factor that impacts your rate is how much you’re paying out-of-pocket for your medical expenses. The more you pay, the less your monthly premium will be.

Low vs. High Deductible

If your deductible is high, you’ll pay less for your premium because the insurance company assumes less risk on your behalf. A deductible is an amount you have to pay upfront for medical treatment before your insurance company steps in to help. If you don’t expect to need medical treatment often or at all, you could opt for a plan with a higher deductible to save money.

What If You Don’t Purchase Health Coverage?

Suppose you decide not to purchase health insurance as a self-employed individual. In that case, you risk spending much on emergency treatment or medical expenses associated with pre-existing conditions. Being prepared for anything is important, especially working remotely and in multiple locations.

If you’re worried about the cost, there are a few ways to lower your premium and still get the quality coverage you need. Here are some options for those looking to pay less for their health care plan.

Ways To Lower Your Healthcare Costs

  • Consider every option. From individual plans to marketplace plans, there are options to fit every person. Individual programs are more cost-effective than family plans, but if you have a spouse or dependents, you’ll save more overall with a family plan. A health insurance marketplace, also known as “the exchange,” is where you can sign up and apply for government-subsidized health plans like Medicaid.
  • Get group coverage. If you’re self-employed, like to work from different locations within your home country, and have people who can split costs with you, you could benefit from a group plan. At Insured Nomads, we have many global coverage options that work well for remote workers.
  • Self-employment tax deductions. Often, when you’re self-employed, you’re able to deduct your monthly premium costs. However, there are limitations. First, eligibility is determined month-by-month. So, if you worked for a company for three months out of the year and worked for yourself for the remaining nine months, you can only claim your deduction for those nine months of self-employment. You also can’t deduct more than you earned in revenue. You can’t claim a deduction for your health premiums if your business is not profitable (operating at a loss).

Health insurance can be quite expensive, but it doesn’t have to be. While there are ways to lower your costs, you can still often pay high rates with traditional health insurance companies. At Insured Nomads, we do more than just protect your trip. We also care about your health and wellness.

We’ll Cover You and Your Trip

At Insured Nomads, we offer affordable coverage for your health, your upfront trip expenses, and even your personal belongings. We want travelers to have fun and be as safe as possible at the same time. We are a global team on a mission to make traveling easier for people worldwide.

Protect Yourself

With our health insurance offerings, you’ll be able to get the protection you need without breaking the bank. Even better — you don’t need to wait for the open enrollment period to apply for health insurance through Insured Nomads. You can get coverage anytime. This is perfect for people who work remotely and like to change locations often.

Here’s everything you get with us:

  • Inpatient care. An inpatient is any person who has to be admitted into the hospital for treatment and stays for at least one night. Things like chemotherapy treatments and organ transplants are covered under your health plan.
  • Outpatient care. An outpatient is any person who can be treated within the same day they arrive for help and are sent home without being admitted overnight. Examples of outpatient care include routine consultations and minor urgent care needs.
  • Mental health care. When visiting the hospital for inpatient or outpatient care, you can easily request access to mental health resources anytime. We also offer support for those struggling with substance abuse; the stress of traveling alone can cause survivors to relapse.
  • Miscellaneous care. Other assistance offered under our global health plans include vaccinations, ambulance transport to the local urgent care, maternity care, prescription medication coverage, preventative care, and vision care.

Protect Your Trip & Your Stuff

If you want protection for trip costs and items, look no further than travel insurance. Travel insurance is a great option if you plan to pay a lot in upfront costs, have a pre-existing medical condition, or just want coverage for your things.

Under one of our travel plans, you’ll receive the following:

  • Medical coverage. Our travel plans include access to 24/7 emergency medical care, COVID-19 coverage, treatment for emergencies related to pre-existing conditions, and emergency dental treatment.
  • Transportation coverage. You’ll also get ambulance transportation to your local urgent care facility, natural disaster accommodations, and emergency evacuation or repatriation (relocation back to your country of residence).
  • Miscellaneous coverage. Other protections include filing a reimbursement claim for lost luggage, costs accrued during a flight delay, a stolen cell phone, or injury costs resulting from water sports and other qualifying activities.

You can get all of these perks under the World Explorer plan (single trip, up to a year, outside of your home country).

Get Exclusive Travel Perks

The INC Membership is a great perk for people who are digital nomads (remotely working while traveling). You’ll receive this membership at no extra cost when you purchase a travel or health insurance plan through us.

With this membership, you don’t just get access to a luxury airport travel experience. You also access resources that protect you against life’s unexpected moments.

  • Community. You’ll be able to connect with other travelers using Insured and meet up with them if you choose. You’ll also get exclusive perks from local businesses, which is a great way to meet locals and try new food and other experiences.
  • Culture. You’ll be informed about key demographic information, as well as any holidays or traditions that might be relevant during your time at your destination.
  • Emergency. You’ll have access to our 24/7 panic button when you download our app. You can request help any day and at any time of the year.
  • Wellness. We offer counseling, telemedicine, and mental health assessments. We are multilingual and multicultural. Our counselors can speak the language you’re most comfortable speaking.
  • Travel comforts. You’ll have access to luxury airport lounge experiences while you wait for your next flight, a network VPN for internet security while working remotely, and more.
  • Travel information. If there are any important safety alerts or health updates for sensitive groups, we’ll make sure you’re informed right away.

Are you ready to protect yourself and your trip? Learn more about what Insured Nomads offers and apply for one of our affordable health or travel plans today!

About Insured Nomads   

Insured Nomads is the first to take an integrated traveltech, fintech and insurtech solution to the world for remote workers, globally distributed teams, expats, and travelers. Their purpose is to make travel as safe and smart as staying at home. They do this by providing health insurance with exceptional medical benefits in tandem with wellbeing, safety, security, and advanced tech-enabled solutions for ease of payment for healthcare, emergency response and evacuation. Insured Nomads is available through affinity relationships, direct, embedded and through select brokers and partners for groups and individuals.

When researching destinations and travel, Try Peanut - a free google chrome extension. It automatically displays travel requirements, visa rules and more on, expedia & google flights.


Which states will charge you a penalty if you don’t have health insurance? | HealthSherpa Blog

Self-Employment Definition |

How Age Affects Health Insurance Costs | ValuePenguin

How Do Health Insurance Companies Know if You Smoke? |

5 Factors That Affect Your Health Insurance Premium Costs |

5 Factors That Affect Your Health Insurance Premium Costs | Experian

How Health Insurance Marketplace® Plans Set Your Premiums |

How Much Does Health Insurance Cost? Price Factors |

Self-Employed Health Insurance | Cigna

Do I Need Self-Employed Health Insurance? | eHealth

Deducting Health Insurance Premiums If You’re Self-Employed | TurboTax Tax Tips & Videos

5 Factors That Affect Your Health Insurance Premium Costs | Experian


  • Insured Nomads

    Insured Nomads provides global health and safety protection for the remote worker, traveller & expat. Insurance paired with advanced tech-enabled features and solutions for health, safety, security, well-being and support.

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