A co-payment clause means you share the cost of each admissible claim with the insurer. With a 20% co-payment, if an admissible hospital bill is ₹2,00,000, you pay ₹40,000 and the insurer pays ₹1,60,000. Co-payments can apply to every claim, or only in certain situations — for older policyholders, for treatment in specified cities, or at non-network hospitals.
Why it matters
A co-payment directly reduces what the insurer pays. Policies with one are often cheaper, but the premium saving needs to be weighed against the share of a large bill you would carry.
How to read it
- Where and when it applies. Read whether it is general, age-linked, location-linked or tied to specific treatments.
- Interaction with sub-limits. A co-payment is usually applied after sub-limits and deductions, which can reduce the payout further.
- Voluntary or mandatory. Some policies offer an optional co-payment in return for a lower premium.
Common misconceptions
- “A co-payment and a deductible are the same.” A deductible is a fixed amount you bear before cover starts, common in super top-up plans; a co-payment is a percentage of each claim.
- “It only matters for small claims.” A percentage co-payment matters most on large bills.
- “It can be added at claim time.” The terms are set in the policy wording when you buy; read them before you need them.
In India: Co-payment terms must be stated in the policy wording and the customer information sheet, under IRDAI’s product rules. Read both before buying or renewing.
Formula
Your share = Admissible claim × Co-payment %. Insurer pays = Admissible claim − Your share
Worked example
For illustration, assume an admissible claim of ₹3,00,000 and a 10% co-payment. You pay ₹30,000 and the insurer pays ₹2,70,000, subject to the policy’s other terms.
Figures are for illustration only — not a forecast or a recommendation.
Related terms
Health insurance
Insurance that pays for hospitalisation and related medical costs, up to a sum insured, under your policy’s terms and exclusions.
Waiting period
A period after a health policy starts during which some conditions are not covered, such as pre-existing diseases or specified illnesses.
Claim settlement ratio
The share of claims an insurer settled out of the claims it dealt with in a year — one indicator of how it handles claims.
Emergency fund
Money kept safe and easy to reach to cover several months of essential expenses if income stops or an unexpected cost arrives.