Health Insurance Types – Life & Health License Exam

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A hospital indemnity (or hospital confinement indemnity) plan pays a set daily benefit for each day the insured is hospitalized, with no coordination to actual medical costs.

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A basic medical expense plan covers specific, first-dollar benefits (like hospital room and board) with defined limits and usually no deductible, while major medical covers broad, catastrophic expenses with deductibles and coinsurance.

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A comprehensive major medical plan combines basic medical expense coverage and major medical coverage into a single policy, providing broad protection from the first dollar (after the deductible) without separate base plan limits.

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A corridor deductible is the amount the insured must pay out-of-pocket between the benefits paid by a basic plan and the point at which the major medical plan begins to pay, effectively 'bridging' the two coverages.

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Coinsurance requires the insured to share a percentage of covered expenses with the insurer after the deductible is met—typically the insured pays 20% and the insurer pays 80%—until the out-of-pocket maximum is reached.