Co-insurance refers to a clause typically included in various types of insurance policies, which stipulates that the policyholder and the insurance company share the costs of insured services after a deductible is met. The co-insurance is usually expressed as a percentage and represents the portion of the total medical or claim expenses that the insured must pay. For example, if an insurance policy has a co-insurance of 20%, the insurance company would pay 80% of the covered costs while the policyholder would pay the remaining 20%, once the deductible has been paid. Co-insurance is designed to prevent overutilization of insurance benefits by ensuring that the insured retains some financial responsibility for their healthcare or other covered expenses. It is important for policyholders to understand their co-insurance obligations to anticipate their potential out-of-pocket expenses.
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