Extending Health Insurance

Children are generally dropped from their parents' health insurance when they turn 18 or 19 or graduate from college. But 16 states now require insurers to cover dependent children on their parents' policies until the children are in their mid-twenties -- and sometimes up to age 30.

The new rules can help cover adult children who don't have health insurance through their jobs or don't have jobs. To qualify, grown children must be unmarried and live in the same state as their parents. But they don't need to live with their parents or even be considered dependents for tax purposes.

This can be an attractive option for adult children who have health problems and could have trouble qualifying for affordable insurance on their own. But other young adults might be better off declining the deal. In many states, healthy people in their twenties can purchase insurance on their own for less than $100 per month. (Go to http://www.ehealthinsurance.com or find an insurance agent through http://www.nahu.org.) That could be less than the cost of keeping a child on your family policy.

In most states (other than New Jersey), insurers don't charge extra specifically to keep older children on your policy. But your rate might drop if you remove your child, especially if you're insuring only one child and can switch from family coverage to rates for a single person or a couple. You'd have to compare the price with what it would cost for your child to purchase individual insurance.

If you still have other children on your policy, you may be able to insure older ones at no extra charge (as long as your insurer doesn't base premiums on the number of children). That would be the best deal.

For a list of each state's age requirements for dependent coverage, see the National Conference of State Legislatures' Web site. Note that these laws don't apply to employers who self-insure.