Can I Remain on My Parents' Insurance If My Work Offers Health Insurance?

That first career-type job is a milestone in many young adults' lives. It's something to be proud of but also adds certain complications to your life. Your benefits package is one area where this can be especially confusing. You may not know what to do about health insurance, for example, if you're still covered by a parent's policy.

Health Insurance Parameters

• The parameters of your parent's health insurance policy sets down the circumstances under which you may remain on the policy. In many cases, those circumstances require that you still live with your parents, are a student or are otherwise demonstrably dependent upon them. If you're starting a job that has good health insurance, it may be difficult to meet these standards. However, if you do meet the criteria set down in the policy, no law exists that prevents you from staying on.

Double Coverage

• Insurance law strictly regulates many aspects of the industry, including what happens if somebody is doubly covered by health insurance. In such a case, the companies don't both pay the full amount. A primary policy, usually the one issued first, pays what it must under the contract of the policy. Any remaining amount is picked up by the secondary policy. This prevents "double-dipping" by the insured. It also eliminates the potential advantage of carrying both your work policy and your parent's policy.

Cafeteria Plans

• A cafeteria plan is a benefits package in which the employee gets to choose benefits from a list available to all employees. Under a cafeteria plan, the employee could choose not to accept health insurance and use that benefits "credit" for something else --- such as a wellness benefit or increased retirement contribution. This could be one compelling reason for staying on a parent's insurance policy.

Enrollment Windows

• An enrollment window is the time during which any employee has the opportunity to sign up for health insurance through his employer. In many policies, this is a limited-time annual event. If you're currently eligible to be on your parent's insurance, but that eligibility changes before the next enrollment window, you may want to reconsider forgoing your employer-provided insurance. Note that insurance law in many states specifically permits an employee to enroll outside the window if his circumstances change --- such as by no longer being eligible for other insurance.

Health Care Reform

• The 2010 Health Care Reform Bill enacted sweeping changes in the health insurance climate and set the stage for further reform between 2010 and 2014. One provision of the plan is the requirement to extend a child's ability to stay on a parent's insurance until she reaches the age 26 --- well past the age at which many young adults start their careers. The bill has also created a climate that predicts additional changes to insurance law between 2010 and 2020.