The main thing to remember is that when you sign up for COBRA health insurance, you are actually just being allowed to continue coverage under your former (or current if you lost coverage because of hours) employer’s health insurance program and so you are entitled to the same rights and benefits as a full time non-COBRA insurance covered employee. So, what happens if you have a child while you’re on COBRA? Usually that, and getting married and any other time you would add a dependent, is considered a qualified event and lets you change your coverage.
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When you leave your company, whether it’s because you were let go or whether you left on your own, you will always have the option to elect COBRA health insurance for a specified period afterwards. The way COBRA works is that you are part of the existing health insurance coverage your company provides, except you pay the whole bill rather than just the employee’s half.
Unfortunately, what this means is that COBRA insurance is not available if your company goes bankrupt. The reason this is the case is because there is no health insurance for you to be a part of. With COBRA, you’re joining the company insurance but paying your whole way. If the company is bankrupt, there’s no company insurance for you to join.
The only option you have is independent health insurance.
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