Types of Health Insurance

Health insurance helps you to cover expenses that arise due to an illness. Taking out a health insurance can provide you with protection, certainty and save you cost. Hence, it is essential that you know the types of health insurance that are available. This helps you to compare the types of health insurance plans to find the one that best fits your needs and budget. They include:

Indemnity health insurance: This type of insurance allows you to choose your healthcare provider and pays a set amount or percentage of the cost of your medical expenses.

Health Maintenance Organization (HMO): With an HMO, you pay a fixed monthly premium and choose a primary care physician who coordinates your care. You must seek care from providers within the HMO network, except in emergencies.

Preferred Provider Organization (PPO): A PPO offers a network of healthcare providers, but you can see doctors outside the network for an additional cost. You pay a higher out-of-pocket cost if you choose to go out of network.

Point of Service (POS): This plan combines features of both HMO and PPO plans. You have a primary care physician, and you can see specialists within or outside the network. However, you may have higher out-of-pocket costs if you go out of network.

High-Deductible Health Plan (HDHP): HDHPs have a higher deductible than traditional plans, but they offer lower monthly premiums. You can use a health savings account (HSA) to save money for medical expenses.

Catastrophic health insurance: This type of insurance is designed to cover major medical expenses in case of a serious illness or injury. It typically has a high deductible and low monthly premiums.

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