What’s the difference between insurance deductible, coinsurance, and copay?

comparing-benefits-wordingMany people are confused about the differences between an insurance deductible, co-pay and coinsurance. What are they and how do they differ from each other?

In short, all three represent the portion of the medical bill that you are responsible for in case you get sick or injured – otherwise known as out-of-pocket expenses. However, there are some very unique differences between each one, and we are here to help guide you and understand what each word means in detail.

Deductible

A deductible is usually a fix dollar amount that you have to pay out of your own pocket before the insurance will cover the remaining eligible expenses.Depending on the insurance plan, the deductible can range from $0 all the way up to thousands of dollars. It can also be paid per sickness/injury (per condition) or per certificate period. As a rule of thumb, the higher the deductible the lower the premium (price to buy the plan), and vice versa – but always be sure to choose the deductible that is appropriate for your circumstances when purchasing an insurance policy.

Coinsurance

Coinsurance is usually a percentage, and represents the percentage cost that you will need to pay and the insurance plan will pay towards your eligible medical expenses. Some common coinsurance examples include: 100%, 80/20, 90/10 and 50/50 – so if you have 80/20 coinsurance on your insurance plan, it means that the insurance company will cover 80% of your medical cost and you are responsible for paying the other 20% yourself. A deductible is commonly use together with coinsurance. In this case you would pay the deductible amount first and after you would have the left over coinsurance amount.

Copay (copayment)

Copays are similar to deductibles, in that it is usually a fixed amount of money you have to pay each time you need to use your insurance plan. Unlike deductibles, copays tend to be smaller dollar amounts and are applied on a per visit basis so that that you would have to pay it each visit.

With most insurance plans, you will typically see some combination of deductible, coinsurance and copayments – or in some cases your plan may not have any of them. It will very much depend on your specific insurance plan so be sure to check the policy details so you know what your out-of-pocket payments will be. For more information about insurance terms, and to help guide you further please visit our insurance explained section where we delve into all areas of insurance to help you understand insurance plans more!


Category: Insurance Explained, Product Information

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Originally from Thailand, Apinant grew up in the United States and has extensive international experience traveling throughout Asia, Australia, North America and Europe. He has lived, studied and worked abroad in China, England, Taiwan and Thailand. Apinant is a graduate of the University of Florida with a Masters in International Business and a Bachelors of Science in Business Management.

 

6 Responses to “What’s the difference between insurance deductible, coinsurance, and copay?”

  1. capsicum says:

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  2. Mike says:

    With a family, how does the deductible work? I have 1,700 individual and 3,400 family. If my deductible hits 1,700 and my wife hits 1,700 does that satisfy the family deductible for any other issues that happen to not only my wife and I but our children as well?

  3. akash says:

    I’m confused between Ded, Coins and Copay. Can u give me a simle Example.

    • Bryanna Davis says:

      Hi Akash,

      The deductible and copay will be what you must pay when you use the plan- before the insurance begins to pay. The co-insurance will be the shared cost of your remaining eligible expenses- this means you will pay a portion of your remaining bill and your insurance will pay a portion of your remaining bill.

      You can call us Monday-Friday 8am-6pm EST at +1-904-758-4391 for more information on these items and to find the perfect plan for you.

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