Georgia Life, Accident and Sickness Practice Exam 2025 - Free Life, Accident and Sickness Practice Questions and Study Guide

Coinsurance is a cost-sharing arrangement in health insurance that is expressed as a percentage. It refers to the portion of covered healthcare services that the policyholder is responsible for after meeting their deductible. For example, if a health plan has a coinsurance rate of 20%, the insurer pays 80% of the costs, while the insured pays the remaining 20%. This system is designed to share the financial burden between the insurer and the insured, encouraging both parties to be mindful of healthcare costs.

In contrast, a copayment is a fixed amount that the insured pays for specific services, such as a doctor’s visit. A flat fee is a set dollar amount paid regardless of the service provided and does not vary based on the percentage of the costs. The policy premium is the total amount paid, usually monthly, to maintain coverage and is not calculated based on a percentage of healthcare expenses. Therefore, coinsurance uniquely stands out because it embodies this percentage-based payment structure.