When buying health insurance, you may come across the term co-payment (co-pay).
It is an important policy feature because it determines how much of an eligible
medical expense you have to pay yourself.
Co-payment is the percentage of an eligible medical claim that the policyholder
must pay from their own pocket, while the insurance company pays the remaining
amount, subject to the terms and conditions of the policy.
For Example: The co-payment percentage is mentioned in the health insurance
policy. Suppose your policy has a 10% co-payment and your eligible claim is
₹50,000. You would pay ₹5,000, while the insurer would pay ₹45,000, subject to the
policy conditions.
Co-payment may apply to all claims or only to specific situations, depending on the
policy. Some policies may have co-payment requirements related to age, particular
treatments, hospitals, or other conditions.
Co-Payment vs. Deductible
Co-payment and deductible are different. A deductible is an amount that the
policyholder has to pay before the insurer pays eligible expenses, according to the
policy terms. A co-payment is generally a percentage of the eligible claim that is
shared between the policyholder and insurer.
For example, a policy may have a ₹10,000 deductible and a 10% co-payment. This
means the policyholder may have to bear the deductible as well as the applicable co
payment, depending on how the policy is structured.
Before buying a health insurance policy, check:
- The percentage of co-payment.
- Whether it applies to all claims or specific treatments.
- Whether age or hospital-related conditions apply.
- Other deductibles or sub-limits.
- Exclusions and non-payable expenses.
- How your share is calculated during a claim.
Conclusion
Co-payment is an important factor to consider when choosing health insurance. A
policy with a co-payment clause means that you will have to bear part of an eligible
medical expense yourself. Therefore, don’t consider only the premium when
comparing policies. Read the policy terms carefully and understand your
potential out-of-pocket expenses before purchasing health insurance.