What are the two main types of health insurance plans?

The two main types of health insurance plans—individual plans and group plans—represent distinct approaches to obtaining health coverage. Individual plans are purchased by a single person or family, providing coverage tailored to their specific needs. These plans are often more flexible, allowing consumers to select options that directly align with their personal health care requirements.

In contrast, group plans are typically offered by employers, unions, or other organizations and provide coverage to a group of individuals—usually employees and their dependents. These plans often come with lower premiums than individual plans because the costs are shared among a larger number of people, and they may include benefits that are negotiated by the employer.

Understanding the difference between these two types is crucial for individuals navigating health insurance options. While individual plans allow for customization, group plans provide the benefits of collective bargaining, potentially making them more affordable for many.

The other answer choices cover variations and specific niches of health insurance but do not encapsulate the primary classifications of health plans as accurately as the combination of individual and group plans does.