Heath Care

Health Care Plans

Health Care

Types of Health Insurance

Indemnity Insurance

This type of insurance is also known as a traditional or fee-for-service plan. The benefit of an indemnity plan is the flexibility; this plan allows members to choose any doctor or hospital. However, members must pay an annual deductible and then a percentage of each medical bill. Although these plans offer the greatest freedom to select any doctor, they are usually the most expensive option.

Typically, the member or the provider sends the bill to the insurance company. These plans usually have an annual deductible before the insurer starts paying. Once the deductible has been met most indemnity plans pay a percentage of what they consider the "Usual and Customary" charge for covered services. The insurer generally pays 80% of the Usual and Customary costs and the member is responsible the other 20%, known as coinsurance. If...
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