What term refers to the monthly payment to an insurance company?

What term refers to the monthly payment to an insurance company?

• A. Copay
• B. Deductible
• C. Premium
• D. Coinsurance

Answer: (C)

That monthly payment to maintain an insurance policy is called the premium. It’s the amount you pay to the insurer on a regular schedule (often monthly) to keep your coverage active, regardless of how much or how little healthcare you use. This differs from other cost-sharing terms: a copay is the fixed amount you pay when you receive a specific service, a deductible is the amount you must pay out of pocket before the insurer starts paying, and coinsurance is the percentage of costs you pay after the deductible is met. Because it represents the ongoing price of having coverage, the monthly premium best fits the description in the question. If you miss premium payments, the policy can lapse, ending coverage even if you haven’t used services.

That monthly payment to maintain an insurance policy is called the premium. It’s the amount you pay to the insurer on a regular schedule (often monthly) to keep your coverage active, regardless of how much or how little healthcare you use. This differs from other cost-sharing terms: a copay is the fixed amount you pay when you receive a specific service, a deductible is the amount you must pay out of pocket before the insurer starts paying, and coinsurance is the percentage of costs you pay after the deductible is met. Because it represents the ongoing price of having coverage, the monthly premium best fits the description in the question. If you miss premium payments, the policy can lapse, ending coverage even if you haven’t used services.