Tertiary Insurance Definition
Tertiary insurance is a supplemental coverage plan. It is used primarily for health care but is available for other coverage such as traveling and banking. It provides a safety net in case of rare instances when other forms of insurance are inadequate.
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The Facts
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Tertiary insurance provides coverage beyond primary and secondary insurance coverage. The tertiary insurance company works with the other two insurers in providing a "coordination of benefits." This determines which insurance company will pay for what part of a claim.
Benefits
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Tertiary insurance can be beneficial if you may need extra insurance to pay for a procedure, care or service. Sometimes the covered incident may be expensive or be a rare occurrence which could lead the first two insurers not to fully cover the claim. Having tertiary insurance can help minimize or eliminate the costs that would come out of your pocket.
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Considerations
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To have tertiary insurance involved in a claim, the first two insurance policies must not be fully adequate. For instance, when your primary insurance company is billed for services and there is a balance left over, the secondary insurance company receives a bill for the remainder. If the secondary insurance company doesn't pay all or part of the outstanding balance, then the tertiary insurer is on the hook for the remaining charges.
Misconceptions
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Some may see tertiary insurance as an unnecessary form of coverage since the primary and secondary insurers usually are enough to cover a claim. This may be true, but not all incidents are covered. There are always exclusions or low coverage amounts and the first two insurers might not be sufficient enough to pay for your claim. Tertiary insurance could come to an insured person's aid in that situation.
Types
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Most tertiary insurance options are either low cost or a form of entitlement due to their profession or their perk package. Government insurance programs such as Medicare and military insurance are relegated to the second or third coverage option. Other forms of tertiary insurance may be offered from your credit card, bank or any other company that adds an insurance protection plan as part of its package.
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