How to Get Health Insurance for LLC Owners? (2023 Guide)

Jon Morgan
Published by Jon Morgan | Co-Founder & Chief Editor
Last updated: October 6, 2023
We meticulously research and verify the information presented in our articles. By consulting reliable sources and ensuring factual accuracy, we are committed to providing readers with well-informed, trustworthy content.

If you're the owner of an LLC, you may be wondering how you can buy health insurance.

You should know there are a few different ways to get health insurance as an LLC owner, but from my experience, you need to choose wisely.

After opening dozens of LLCs, I can tell you that health insurance is something to be mindful of.

Not only will I share my knowledge on the topic, but I will also include input from legal experts.

Quick Summary

  • To get small business health insurance for LLC owners, you need to choose a plan that suits your business needs
  • To see what type of health insurance might serve you the best know the features of individual, group, and health insurance exchanges.
  • If you're unsure of which health plan to buy or have questions, see an expert. The taxes of an LLC can have a big impact on the kind of health plan you can acquire.


How LLC Owners Can Get Health Insurance

Giving health insurance policy to an LLC owner

LLC owners can obtain health insurance by exploring options such as individual health plans, group health insurance coverage through professional associations, or Health Reimbursement Arrangements (HRAs) tailored for self-employed individuals.

However, many LLC owners opt to apply online, which is the fastest way. To do this, you need to go online, create an account, and scroll through options in your area [1].

1. Individual Health Insurance

When seeking small business health insurance, an individual health insurance plan offers flexibility but can be costlier.

For employees, explore affordable group health insurance coverage options through your LLC, ensuring comprehensive coverage. Consider the pros and cons before deciding on the most suitable option for your needs.

2. Group Health Insurance

Obtaining small business health insurance through a group health insurance offered by your LLC grants access to multiple providers while potentially saving on costs compared to individual plans.

Employees may be required to contribute a nominal monthly premium. For more details, consult reputable insurance providers or brokers in your area.

3. Health Insurance Exchanges

Another option for LLC owners to obtain group health insurance is enrolling in a health insurance exchange.

These state-based marketplaces offer a variety of group health plans for comparison and purchase, providing flexibility and choice. Explore available options in your state for suitable health coverage.

Health Insurance and LLC Taxation

Health insurance and LLC taxation are linked, as the taxation of an LLC can significantly impact the type of health plan you're able to purchase.

Single-Member LLC Taxed as a Sole Proprietorship: 

If you're the sole member of your LLC, it will be taxed as a sole proprietorship or self-employed.

Unfortunately, health insurance premiums cannot be deducted as a business expense in these cases. Consider personal health insurance options for coverage.

Multiple-Member LLC Taxed as a Partnership or S Corp:

If you're part of an LLC with multiple owners or members, it will be taxed as a partnership or S corp. This means that the company's profits and losses will flow through to your personal income tax return.

LLC Taxed as a Corporation: If your business is taxed as a corporation, the type of health plan you're able to purchase will be significantly more limited, and the costs will generally be much higher.

Choosing The Right Health Plan

Doctor reaching out for patient's hand

Choosing the right health plan can be a bit confusing, but it's worth taking the time to research your options and find the plan that's right for you.

By understanding your options and choosing the right plan, you'll be able to protect yourself and your business and provide employee health insurance.

If you filed as a non-member employee, you might have to consider getting individual health insurance [2].

If you filed as self-employed, you might have to consider getting group health insurance plans directly from an insurance company or brokers.

If you filed as a partnership and you and the other partners wish to get group health insurance (which can be inexpensive), I would suggest talking with an accountant or tax advisor to see if that's possible for your company.

If you filed as a corporation, your options would be generally limited, and health coverage costs will generally be substantially higher than LLCs and other unincorporated entities.

Most small business owners are now opting for an alternative option, which is a health reimbursement arrangement. An HRA is an agreement between you and your insurance company to be reimbursed tax-free for medical expenses.

You set money aside each month to cover anticipated healthcare costs.

The nice thing about an HRA is that you can use it with individual or group health insurance plans. You can also use it to cover expenses that your regular group health plans don't cover, such as dental or vision care.

Related Articles:


Is a Health Insurance Premium Tax Deductible with LLCs?

The health insurance premium is tax deductible with LLCs. If any person in the company is eligible to participate in a group health insurance plan through their own employer, they cannot be covered by the LLC's plan.

How Much Does Health Insurance Cost?

The cost of health insurance varies, depending on the type of coverage you choose and how big your business is.

How Do I Provide Health Insurance if I Own a Small Business?

To provide health insurance if you own your own small business, you will have to choose between several options. You can purchase coverage on your own or join a group health insurance plan through an association or professional organization.

Who Is Eligible for Government Health Insurance?

Small business owners with employees are eligible for government health insurance through SHOP (Small Business Health Options Program).

Can I Get Health Insurance for Small Businesses Such as LLCs?

Yes, you can get health insurance for small businesses such as LLCs. The type of coverage you're able to purchase will depend on the tax status of your small business, but most LLCs can deduct premiums paid for themselves and their employees.

Get the Right Health Insurance for LLC Owners

As a small business owner, if you do not purchase group health insurance, it will cost you! An LLC can get small business health insurance, but the type of plan available to a company in certain tax status will vary.

To find out more about your options for getting health or business insurance plan, check Progressive Insurance who will help you identify a plan that works best for your LLC.



About The Author

You May Also Like

Leave a Reply

Your email address will not be published. Required fields are marked *