Copay in Health Insurance

Exclusive

Wellness Benefits

24*7 Claims

Support

Tax Savings

u/s 80D

Zero Paperwork Online Process

Pin Code

+91 Enter Mobile Number

Try agian later

I agree to the Terms & Conditions

Port My Policy

Download Policy

(Incl 18% GST)

What is Copay Full Form & Meaning in Health Insurance and How it Works?

In the last few years, availing competitive treatment from medical facilities at affordable rates have become next to impossible for those belonging to the mid-income group in the country. Even though rapid economic development has aided many to avail a better lifestyle, affordable healthcare is still amiss from the country’s overall infrastructure.

That is why availing a health insurance policy is not just an option but a necessity when it comes to seeking competent healthcare in our country. Having a healthcare policy in place allows you to ensure that you are protected against the financial liabilities that can arise from sudden medical emergencies.

What is Copay in Health Insurance

Copay in Health Insurance refers to the percentage of the claim amount that has to be borne by the policyholder under a health insurance policy.

Few insurance policies come with a mandatory clause for copayment, while others offer policyholders the option for voluntary copayment, which allows them to reduce their premium payment.

How it works?

Usually, with health insurance policies, you can opt for two types of claims:

With cashless treatment, your insurance provider offers to settle your expenses incurred directly with the hospital where you or your family members are undergoing treatment.

On the other hand, with a reimbursement claim, the insurance provider will reimburse you for the expenses incurred while you were undergoing treatment.

Now, there are two situations that can arise from copayment:

When you opt for a higher copay, it will help to lower your total premium payment, but you will have to pay a greater amount during a claim.
If you opt for a lower copay, it will reduce the amount that you will have to pay during the claim, but you will have to pay a higher premium against your insurance policy.

For instance, if you have opted for 15% copay, your insurance provider will bear 85% of the claim amount, while the rest will have to borne by you.

Read: Learn more about the coverages of COVID 19 Insurance Policy

What are the Types of Copay Clauses in Health Insurance?

Now that we have learnt about what is copay in medical insurance, let us take a look at its types.

Not all health insurance policies come with mandatory copay clauses. But, if your health insurance policy has this clause, it can be applied in ways illustrated in the table below:

Type of Copay	Applicability
On Medical Bills	Under this category, the copay clause is applicable to all the claims raised, irrespective of whether it is voluntary or mandatory. You will thus need to pay a portion of the claim amount thus raised.
On Senior Citizen Policies	These are the policies that mostly come with mandatory copay clauses. This is mostly because the treatment expenses for senior citizens are usually much higher.
For Reimbursement claims & Treatment at any non-network Hospital	Sometimes, insurance providers only levy the copayment clause on reimbursement claims or during treatment at non-network hospitals. Under these circumstances, the cashless claims are borne by insurance providers.
For Hospitalisation in Metro Cities	Since treatment costs at metropolitan cities are higher than that of smaller cities and towns, insurance providers might levy a copay clause for such circumstances.

Features of Copay Health Insurance Policy

To understand what is copay in health insurance, you will first have to know about its features. We have listed out its features as follows:

Under this system, the majority of your claim is covered by the insurance provider while you have to take care of a certain percentage of the expense incurred.
The copay percentage depends on the medical service that you avail.
If you opt for a lower copayment amount, you will have to pay higher premiums against your health insurance policy.
When it comes to copay meaning, it can also be used interchangeably with co-insurance.
Copay clauses are mostly levied for senior-citizen health insurance policies.
These are more popular in metropolitan cities where the cost of treatment is higher than that of smaller towns and cities.

Why Insurance Companies levy Copay Clauses on Policyholder?

Well, the most obvious reason for insurance companies to levy copay clauses on policyholders is that it can help them save a portion of their cost on claims raised.

Other than that, what are the reasons for insurance companies to levy the copay clause on their health insurance policies?

Take a look!

1. Prevents the misuse of Policies - Well, the most important reason why insurance providers levy a copay clause on their policies is that it helps to stave off unnecessary claims on the policyholders’ part.

For instance, a person might want to raise claims against the treatment of diseases that do not warrant a high treatment cost. Having a copay clause in place can prevent the misuse of insurance policies in this case.

2. Promotes honest usage of Insurance Policies - Since copayment requires you to pay a percentage of your treatment cost out of your own pocket, it increases your stakes in the matter. As a result, it encourages judicious and honest usage of the policy on the part of the policyholder.

3. Makes you consider your options before seeking Expensive Healthcare - Even with the cost of treatment rising continually, individuals often seek treatment from an expensive hospital, which gives way for unnecessary costs.

For instance, if you have a copay clause where you have to pay 10% of the treatment costs, then for a bill of Rs. 10,000, you will have to shell out Rs. 1,000. But if you seek treatment from an expensive medical centre, your bill can go up to Rs. 50,000 for the same treatment, out of which you will have to pay Rs. 5,000.

Thus, a copay option will encourage an average policyholder to refrain for seeking treatment in hospitals with high expenses.

4. Mitigates the Risks of Insure Providers - Under the copayment clause, insurance providers do not have to pay 100% of the total claim amount.

Advantages and Disadvantages brought by the Copay Clause

Advantages	Disadvantages
One of the biggest advantages when it comes to the copay clause is that it helps to lower the premium paid towards your insurance policy. Even if you have to pay a part of your claim for that, it can prove beneficial because it reduces your periodic expenditures by lowering your premium payment.	Insurance policies which demand a high copayment amount from policyholders can stop the insured person to seek proper healthcare during their time of need, and render the policy useless. Copayment puts the insured person at a disadvantage because they can’t avail adequate healthcare from insurance providers, without paying for a portion of the same.
--	Even though higher copay means less premium, you will end up paying more towards your treatment expenses than you save on premiums.

That is why health insurance policies without copay clauses are much more popular than those which levy it.

What should you consider before opting for Health Insurance with Copay Clause?

Even though you might find health insurance plans with copayment clause much more affordable, it is crucial for you to determine your coverage requirements before you opt for it. Further, you must also ensure that you have adequate finances to cover your share of hospitalisation bills before you opt for a plan with copay options.

In denouement, even though health insurance plans with copayment option might seem like a good idea, it does little in reducing your financial liabilities in case of medical emergencies.

Therefore, it is always more advantageous to opt for a health insurance policy which does not have such copay clauses.

FAQs about Copay in Health Insurance

All

What is the Copayment in Health Insurance by Digit?

It's 0%. Yes, you read it right. There is no Copayment involved in Health Insurance by Digit.

How to know about my Copayment liability at the time of Claim settlement?

Your health insurance policy document will have every relevant detail regarding the copayment option – whether you require to pay it, the percentage at which it is levied, etc.

Is Copay levied on Cashless Hospitalisation?

Copay options are mostly levied on reimbursement claims. This is to encourage policyholders avail treatment in their network hospitals

Are the policies with Copay clauses cheaper?

Yes, policies with copay clauses are cheaper because the liability of claim settlement is divided between the insurance provider and policyholder.

Latest News

Currently there are no news to show.

More articles related to Health Insurance

Deductible in Health Insurance

Sum Insured in Health Insurance

Daily Hospital Cash Benefit

Types of Health Insurance

PED in Health Insurance

What is Copay in Health Insurance

Cancer Insurance Cover

TPA in Health Insurance

Difference between Mediclaim Policy and Health Insurance

Difference between Term Insurance and Health Insurance

Difference between Life Insurance and Health Insurance

What is Health Insurance

Best Health Insurance Policy in India

Daycare Treatment and Procedures in Health Insurance

Room Rent Capping in Health Insurance

Health Insurance for Diabetes Patients

Health Insurance covering Cataract Surgery

Health Insurance with Free Annual Checkup

Domiciliary Hospitalization in Health Insurance

Government Health Insurance Schemes

Sub-Limit in Health Insurance Policy

Cooling-off Period in Health Insurance

Loading in Health Insurance

Pre and Post Hospitalization Expenses in Health Insurance

GMC and GPA Policies in Health Insurance

Indemnity Health Insurance

Health Insurance for Disabled Persons

Difference Between Waiting Period and Survival Period

Types of Health Insurance Claims

Health Tips & Guides

Nutrition Tips & Guides

Human Wellbeing

Guides about different Diseases

Health Insurance Tips

Health Insurance for Smokers

Comprehensive Health Insurance

Buy Health Insurance on EMI

What is Nominee In Health Insurance

Grace Period in Health Insurance

Health Insurance for Parents of NRIs

Difference between Moratorium and Full Medical Underwriting

Exclusions in Health Insurance

Non - Medical Expenses in Health Insurance

Road Ambulance Cover in Health Insurance

Consumable Cover in Health Insurance

Air Ambulance Cover in Health Insurance

What Is Reimbursement Claim ?

Health Insurance Tax Benefits for Senior Citizens

Why Separate Health Insurance for your Parents?

Health Insurance After Retirement

Health Insurance for Pre-Retirees

Health Insurance for Freelancers and Self-Employed

Health Insurance for Government Employees

Why Health Insurance is Important for Mothers?

Difference Between Inpatient and Outpatient Hospitalisation

Restoration Benefit in Health Insurance

Cumulative Bonus in Health Insurance

Terminal vs Critical Illness

Health Insurance Myths

How to Choose the Right Sum Insured

Mental Health Insurance

Infertility Treatment Cover

Bariatric Surgery Cover

What is Organ Transplant Cover

AYUSH Benefit in Health Insurance

Compare Health Insurance

Maternity Health Insurance

Zone Based Health Insurance

Copay vs Coinsurance vs Deductible

Health Insurance Add-Ons

Health Insurance Benefits

Dental Health Insurance

Increase in Health Premium on Renewal

Fixed and Indemnity Health Insurance

Maternity Benefit without Waiting Period

Difference between Copay Coinsurance and Deductible in Health Insurance

Waiting Period in Health Insurance

Why Health Insurance Premium Increase on Renewal

Download Health Insurance Policy Wordings

Click here for Policy wordings | Digit Health Care plus policy - Benefit illustration

Disclaimer #1: *Customer can choose options at the time of availing insurance. Premium amount may vary accordingly. Insured is required to disclose any pre-existing condition or on going treatment before policy issuance in the proposal form.

Disclaimer #2: This information is added only for informative purposes and collected from different sources across the Internet. Digit Insurance is not promoting or recommending anything here. Please verify the information before making any decisions.

Get 10+ Exclusive Features only on Digit App

Install

Get 10+ Exclusive Features only on Digit App

Latest News

Currently there are no news to show.

Renew & Download Policy Document, Check Challan, Credit Score, PUC & more

43K+ Reviews

4.7

Rated App

43K+ Reviews

7K+ Reviews

4.4

Rated App

7K+ Reviews

Download the App

CIN: U66010PN2016PLC167410, IRDAI Reg. No. 158.

Go Digit General Insurance Limited (formerly known as Oben General Insurance Ltd.) - Registered Office Address - 1 to 6 floors, Ananta One (AR One), Pride Hotel Lane, Narveer Tanaji Wadi, City Survey No.1579, Shivaji Nagar, Pune-411005, Maharashtra | Corporate Office Address - Atlantis, 95, 4th B Cross Road, Koramangala Industrial Layout, 5th Block, Bengaluru-560095, Karnataka | Trade logo of Go Digit General Insurance Ltd. displayed above belongs to Go Digit lnfoworks Services Private Limited and is provided and used by Go Digit General Insurance Ltd. under license.