If you’re looking to purchase health insurance, it’s important to understand its different terms and concepts. One important concept is coinsurance, which refers to the percentage of the medical bill you must pay out of your pocket. In this guide, we’ll cover all you need to know about coinsurance in health insurance in India.
What is Coinsurance in Health Insurance?
Coinsurance is the amount you must pay for medical expenses after you’ve met your deductible. In other words, it’s the percentage of the total medical bill you must pay out of your own pocket while the insurance company covers the remaining portion.
For instance, if you have a coinsurance rate of 20% and your medical bill comes up to Rs. 10,000, you’ll have to pay Rs. 2,000 (20% of Rs. 10,000) out of your pocket, while your insurance company covers the remaining Rs. 8,000.
Coinsurance vs Copay
Coinsurance is often confused with copay, another term used in health insurance. While the former is a percentage of the medical bill that you pay out of your pocket, copay is a fixed amount that you pay for a particular service.
For example, if your copay is Rs. 500 for a doctor’s visit, you’ll have to pay Rs. 500 every time you visit the doctor, irrespective of the total medical bill.
Coinsurance in Different Types of Health Insurance
Coinsurance can vary based on the type of health insurance policy you have. Here’s a breakdown of how it works in different types of policies:
- Individual Health Insurance: The policyholder pays the coinsurance amount in individual health insurance policies.
- Family Floater Health Insurance: In family floater policies, the coinsurance amount is shared by all the members covered under the policy. For instance, if the policy covers four members and the coinsurance amount is 20%, each member must pay 5% of the medical bill.
- Group Health Insurance: In group health insurance policies, the coinsurance amount is often split between the employer and the employee.
How to Choose the Right Coinsurance Rate
When choosing a policy, it’s important to consider the coinsurance rate. A higher rate means lower premium payments, but it also means that you’ll have to pay a larger portion of your medical bills out of pocket.
On the other hand, a lower coinsurance rate means higher premium payments, but it also means that you’ll pay a smaller portion of your medical bills out of pocket.
When choosing the right rate, factors include your budget, medical history, and risk tolerance.
Coinsurance is an important aspect that can impact out-of-pocket expenses. You can choose the right health insurance policy that meets your needs and budget by understanding how it works.
If you have any further questions or concerns about coinsurance in health insurance, feel free to contact our team at Plum. We’re always here to help.