Which definition describes coinsurance?

• A. An amount the insured may be required to pay as his or her share of the cost for services after the deductible has been paid.
• B. A fixed amount charged for a service at the time of service.
• C. The insured's entire bill.
• D. A monthly premium.

Answer: (A)

Coinsurance is the portion of covered expenses you pay after you’ve met the deductible. It’s usually a percentage, such as 20%, with the insurer covering the remaining 80% of eligible charges. This is why this definition fits best: it describes your share of costs after the deductible has been paid. It differs from a fixed copayment, which is a set amount charged at the time of service, and from paying the entire bill or a separate monthly premium, which are not how coinsurance is defined. Coinsurance continues until you reach the out-of-pocket maximum, at which point the insurer typically covers 100% of allowed costs.