What is coinsurance?
Coinsurance is the portion of medical costs that are shared by both the Insured (the patient) and the Insurer. For example, if you have an 80% to $5,000 coinsurance; ~ The Insurer is responsible for 80% of the next $5,000 in covered medical expenses. ~ The Insured is responsible for 20% of that same $5,000 in covered medical expenses. * In the above mentioned policy with $1,000 deductible and 80% coinsurance to $5,000: If a covered event occurred that had a total cost of $10,000, the insured would be responsible for the first $1,000 (deductible). Of the next $5,000 in covered expenses, the insured would pay another $1,000 (coinsurance). After deductibles and coinsurance are satisfied, Insurance Companies pay 100% of all other covered expenses. For this example the Insured would pay $2,000 and the Insurer would pay $8,000. • Q: What is a “Doctor’s Office Visit Copay”? A: Generally, this is an amount of money that an insured patient would pay to their doctor for that particular visit. In
Coinsurance is a provision in your policy which states that if you fail to carry at least 80% of the replacement cost of the property, you may receive a reduced loss settlement. Please keep in mind that the coinsurance clause relates to the value of the property when the loss occurs, not when the policy was written In general, most policies have a coinsurance provision. Please refer to the next question for an example.
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- What is coinsurance?
