Is the Concept of Co-pay in Health Insurance a Boon or Flaw?

In recent years, the skyrocketing cost of the healthcare sector has made it almost impossible for the middle-income group of the country to avail the right medical facilities at affordable rates. Even though many developments have been made in the healthcare sector, affordable medical treatment is still a miss from the overall infrastructure of the country.

Read More

Policybazaar exclusive benefits
  • 30 minutes claim support*(In 120+ cities)
  • Relationship manager For every customer
  • 24*7 claims assistance In 30 mins. guaranteed*
  • Instant policy issuance No medical tests*

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

*Tax benefit is subject to changes in tax laws. Standard T&C Apply

Back
Find affordable plans with up to 25% Discount**
  • 1
  • 2
  • 3
  • 4

Who would you like to insure?

  • Previous step
    Continue
    By clicking on “Continue”, you agree to our Privacy Policy and Terms of use
    Previous step
    Continue

      Popular Cities

      Previous step
      Continue
      Previous step
      Continue

      Do you have an existing illness or medical history?

      This helps us find plans that cover your condition and avoid claim rejection

      Get updates on WhatsApp

      What is your existing illness?

      Select all that apply

      Previous step

      When did you recover from Covid-19?

      Some plans are available only after a certain time

      Previous step
      Advantages of
      entering a valid number
      valid-mobile-number
      You save time, money and effort,
      Our experts will help you choose the right plan in less than 20 minutes & save you upto 80% on your premium

      Thus, in this day and age, having a health insurance policy is a necessity more than a choice. The right health insurance policy ensures that you are protected against the financial burden that may occur due to sudden medical emergencies.

      Further in this article, we will briefly discuss the concept of copay in health insurance and its advantages and disadvantages.

      What is Co-pay in Health Insurance?

      Copay in health insurance is defined as the percentage of the claim amount that the policyholder bears under a health insurance policy. Some health insurance providers come with a compulsory clause of copayment while other insurers provide the option of voluntary copayment to the policyholder, which allows them to reduce their cost of premium payment.

      How Co-pay Works?

      Generally, in health insurance policies an individual can opt for two types of claims:

      • The option of Cashless Treatment Under this option, the insurer offers to settle expenses that occurred directly with the hospital where your family members or you are undergoing treatment.
      • The option of Reimbursement for Expenses Incurred Under this claim process, the insurer reimburses the expenses that occurred while you were undergoing treatment. Now, with the co-payment two situations can arise.
      • If you choose a higher copay, you will have to pay a higher amount during a claim. However, it will reduce the total premium payment of the policy.
      • On the other hand, if you opt for a lower copay, you will have to pay a lower amount during a claim. However, the premium amount for your health insurance policy will be high.

      For example, if the policyholder has chosen a copy of 15%, the insurer will bear 85% of the claim amount, whereas the rest of the amount will have to be borne by the policyholder.

      You may also like: Is it wise to choose a health card over opd insurance

      Co-pay Health Insurance Policy Features

      Let’s take a look at the features of the co-pay to understand it in detail.

      • Under the system of copay, the insurer covers the majority of the claim while the policyholder needs to take care of a specific percentage of expenses occurred.
      • The percentage of copay depends on the medical services availed by the policyholder.
      • If the policyholder opts for a lower copay, he/she will have to pay a higher premium amount for the health insurance policy and vice versa.
      • Copay in death insurance policies is popular in metropolitan cities, where the cost of medical treatment is higher as compared to the other cities in the country.

      Advantages and Disadvantages of Copayment in Health Insurance

       The following are some of the advantages and disadvantages of copayment in health insurance.

      Advantages

      Disadvantages

      A higher % of co-payment means a lower premium for the policyholder. Even if a policyholder has to pay a higher amount during the claim, it can be beneficial as it lowers the periodic expenses by reducing the premium payment.

       

      The insurers who demands a high copayment amount from the policyholder can stop them to avail proper health care during any medical emergency. The disadvantage of copayment is that cannot avail adequate healthcare from the insurance policy without paying a share for the same.

      With co-payment, the unnecessary claims go down as the policyholder will not like to file a claim for every small medical treatment they undertake. Since the policyholder knows that he/she will have to bear a portion of the cost they will only opt for the necessary treatment.

      Although a higher co-pay amount means less premium, the policyholder will eventuality end up paying more towards the expenses of the treatment rather than saving on premium amount.

      Co-payment in health insurance works best for insurance buyers who are young and are less prone to diseases or the probability of them getting hospitalized in very low. This means that the policyholder will have to pay a lower premium. However, senior citizens who suffer from any type of critical illnesses or other diseases should not consider the option of co-payment as it may prove to be very costly for them.

      Wrapping it Up!

      Health insurance policies are specifically designed to provide medical assistance to the insurance buyers and help them to save on the medical expenses that may occur due to any emergency. With the co-pay option, the policyholder agrees to share the risks of the insurer in return for low premiums. The insurance buyers should decide to choose the co-payment only if he/she is convinced that the benefits balance the risk related to this clause.

      Search
      Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

      Health insurance articles

      Recent Articles
      Popular Articles
      Everything about the Activ One Plan by Aditya Birla Health Insurance

      05 Dec 2023

      In a time when increasing healthcare costs can create a
      Read more
      10 Reasons Why Your Health Insurance Claim Can Get Rejected

      01 Dec 2023

      Health insurance plans add a layer of invisible protection against
      Read more
      Knee Replacement Surgery Cost in India

      30 Nov 2023

      Knee pain has become a very common ailment in India, with over 15
      Read more
      Kidney Transplant Cost in India

      30 Nov 2023

      Kidney disease has been growing at an alarming rate in India. As
      Read more
      How Can NRIs Save Taxes on Health Insurance in India?

      24 Nov 2023

      Health insurance is an essential buy for people in India as well
      Read more
      How to Apply for Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY)?
      Ayushman Bharat Yojana is a flagship health insurance scheme launched by the Government of India to offer universal
      Read more
      Best Health Insurance Plans for Senior Citizens in 2023
      Senior citizens are the most prone to diseases. Considering the medical inflation in India, buying health insurance
      Read more
      10 Major Benefits of Ayushman Bharat Yojana
      Pradhan Mantri Jan Arogya Yojana (PM-JAY) is the second component under Ayushman Bharat Scheme. PM Narendra Modi
      Read more
      Does Health Insurance Provide Coverage for LASIK Eye Surgery?
      A vast majority of the Indian population is suffering from vision problems. For some of them, LASIK eye surgery is
      Read more
      Pre-Existing Disease (PED) Cover from Day One
      Pre-existing diseases (PED) are mostly expensive to treat as they are chronic in nature. Unfortunately, most health
      Read more

      top
      Close
      Download the Policybazaar app
      to manage all your insurance needs.
      INSTALL