In a major medical policy, what provision requires the insured to pay part of a loss after the insurer pays a portion?

• A. Copayment
• B. Coinsurance
• C. Deductible
• D. Stop-loss

Answer: (B)

Cost-sharing between the insured and the insurer is a key feature of major medical policies. After any deductible is met, the insurer pays a portion of covered expenses and the insured pays the remaining portion. This sharing of costs is called coinsurance, often expressed as a percentage (for example, 80% covered by the insurer and 20% paid by the insured). Copayments are fixed amounts paid for specific services, not a percentage of total costs. A deductible is the amount you must pay before the insurer begins to pay, and stop-loss (out-of-pocket maximum) caps your total out-of-pocket spending. So the provision described is coinsurance.