Coinsurance

In Health insurance, a provision that the insured and insurance company will share covered losses in agreed proportion. In Health insurance, coinsurance is often a percentage participation, with the insurer paying 80% and the client paying 20%, up to a maximum “stop loss” amount. Coinsurance applies after the deductible has been satisfied. The purpose of coinsurance is to keep the insured from over utilizing the coverage, since he/she has to pay part of every claim. HMOs utilize “co-payments” for office visits, rather than coinsurance.