Free Assistance* from Licensed Agents
Marketplace America.org Health Insurance


What is the Meaning of Coinsurance?

Coinsurance is a cost-sharing mechanism commonly used in health insurance, and sometimes in property insurance, where the insured individual pays a fixed percentage of covered expenses after meeting the deductible. For instance, in an 80/20 coinsurance plan, the insured pays 20% of medical costs, and the insurer covers the remaining 80%. Coinsurance typically applies once the policy’s deductible is satisfied and is distinct from copayments, which involve a fixed dollar amount at the time of service. Health insurance policies often include an out-of-pocket maximum to limit the total amount the insured pays within a specific period.

Key Points:

  • Coinsurance is the portion of covered expenses that the insured individual must pay, usually expressed as a percentage, after meeting the deductible.
  • It comes into effect after the deductible is met and can vary in percentage depending on the insurance plan.
  • Health insurance policies often have an out-of-pocket maximum to protect individuals from excessive costs.

“Glossary.” HealthCare.gov, www.healthcare.gov/glossary/.

“Coinsurance: Definition, How It Works, and Example.” Investopedia, www.investopedia.com/terms/c/coinsurance.asp.

Find the best health insurance coverage in your state.

Get up-to-date plans and prices for individual & family health insurance.