Can a Participant Request a Refund for Unused COBRA Coverage?

Q: A former employee who elected COBRA continuation coverage is requesting a refund of the premiums she paid over the past six months because she did not need to use her medical insurance. Are we required to refund her premiums?

A: No. COBRA premiums are paid to maintain health insurance coverage, regardless of whether the participant actually receives medical services or submits claims.

As long as the participant was properly enrolled and coverage was available during those six months, the employer is generally not required to refund premiums simply because the participant did not use the insurance.

COBRA coverage protects participants against unexpected medical expenses, even during months when no medical care is needed. Just as active employees do not receive refunds of their health insurance contributions when they do not use their benefits, COBRA participants are not entitled to refunds based on a lack of claims.

The participant may generally elect to terminate COBRA coverage prospectively if she no longer wishes to continue paying premiums. However, terminating coverage does not ordinarily create a right to reimbursement for prior months when coverage was in effect.