Copay Vs Coinsurance Vs Deductible
Updated On Mar 31, 2023
Table of Contents
When purchasing health insurance, we come across many terms like copay, coinsurance, and deductibles. Though these terms are related to health insurance, they are entirely different from each other. It is important to know the meaning and difference between these terms to make sure that you buy the right health plan. Read on to understand copay vs. coinsurance vs. deductible in detail.
Meaning of Copay In Health Insurance
The copay is a fixed amount paid by the policyholder against medical costs and treatment bills, while the remaining amount will be paid by an insurance company. For instance, suppose your health insurance policy has a copay clause of Rs. 3,000 and the total cost of the treatment is Rs. 10,000. Therefore, in this case, an insurance company will pay a claim of Rs. 7,000, and the remaining Rs. 3,000 you will have to pay from your own pocket.
Meaning of Coinsurance In Health Insurance
The policyholders have to bear a certain percentage of treatment expenses after all the deductibles are paid. This amount is known as coinsurance. For instance, if the percentage of your coinsurance is 30%, then the remaining percentage of the medical bill will be paid by an insurance company.
The coinsurance clause in health insurance is similar to but different from the co-payment clause. However, the only difference between both them is that a copayment can be fixed in both amounts and a percentage; however, coinsurance can only be fixed in percentages.
Meaning of Deductible In Health Insurance
A fixed amount paid by the policyholder before they start to get coverage for medical treatment is known as a deductible. An insurance company determines the deductible payment term at the time of policy purchase. For instance, if the deductible for your policy is Rs. 4,000, then you will have to pay this amount either monthly or yearly before receiving medical coverage.
Comparison Between Copay, Coinsurance And Deductible
The difference between a copay, coinsurance, and deductible is highlighted in the section below.
-
Copay Vs. Deductible
The table below highlights the difference between a copay and a deductible in health insurance.
|
Comparison Factor |
Co-payment |
Deductible |
|
Meaning |
A fixed amount that is paid by an insured after taking medical treatment and facilities. It can either be a fixed amount or a percentage. |
It is an amount paid by an insured before claiming their health insurance policy. |
|
Impact on premium |
You will have to pay a lower premium if the copayment amount is higher. |
It is paid in smaller premium amounts. |
|
Coinsurance clause |
It is often interchanged with coinsurance. |
You may have to pay coinsurance if your deductible amount is exhausted. |
-
Copay Vs. Coinsurance
The difference between copay and coinsurance is discussed in the table below.
|
Comparison Factor |
Co-payment |
Co-insurance |
|
Application |
It is a fixed amount paid by the policyholder towards the medical costs incurred during treatment. It can either be a fixed amount or a percentage. |
It is a fixed percentage of the amount that must be paid by the policyholder for the medical treatment and costs. |
|
Impact on deductibles |
Copays and deductibles are usually not charged together in the policy. |
The policyholder pays a coinsurance only when the deductible amount is exhausted. |
|
Payment time |
The policyholder may pay this amount at the time of paying the medical bills. |
A coinsurance amount is charged by an insurance company, and you will pay them directly. |
|
Payment process |
Copayment is done every time you take a medical service. |
You have to pay coinsurance when your deductible limit is exhausted. |
-
Coinsurance Vs. Deductible
The difference between coinsurance and deductible is highlighted in the table below.
|
Comparison Factor |
Coinsurance |
Deductible |
|
Meaning |
A fixed percentage of medical bills are paid by you, and the remaining portion of treatment costs is paid by an insurance company. |
It is a fixed amount paid by the policyholder to receive the health insurance claim benefits. |
|
Payment term |
You will have to pay a coinsurance whenever you raise a claim. |
It is paid only once during a policy tenure. |
|
Payment amount |
The amount varies depending on the claim amount. |
It is a fixed sum and is stated in the policy document. |
Conclusion
In conclusion, copay, coinsurance, and deductible are health insurance terms. When purchasing a health plan, make sure that you consider all three terms. For more information regarding insurance terms, you can contact the customer support team at InsuranceDekho.
Also read: What Happens to Health Insurance After the Death of the Policyholder?
