Definition of Major Medical Insurance

Understanding major medical insurance is important.

Major medical insurance is a type of health coverage that pays the costs of nearly all medical treatments, procedures, and examinations. The purpose of this type of insurance is to ensure that medical expenses incurred by a consumer are satisfied without significant out-of-pocket expense. Co-payments largely are eliminated through this type of coverage.

Benefits

The primary benefit of major medical insurance is eliminating most out-of-pocket expenses beyond the annual deductible. A deductible is the amount a consumer pays prior to insurance coverage "kicking in."

Types

There two most common types of major medical insurance are known as comprehensive and supplemental. Each of these major medical insurance schemes approach coverage in different ways.

Comprehensive

Comprehensive major medical insurance combines traditional health insurance provisions with additional coverage that covers nearly any medical expense.

Supplemental

Supplemental major medical insurance, as the name implies, is a separate policy of insurance that pays for medical expenses not covered by traditional health insurance policies. A supplemental plan acts like co-insurance for a consumer with a basic medical policy.

Time Frame

As is the case with more traditional health care coverage, major medical insurance runs for a term of one year in most cases, and is usually renewable at the end of that time period.

References

• Financial Web, Major Medical Insurance
• "The New Health Insurance Solution: How to Get Cheaper, Better Coverage Without a Traditional Employer Plan;" Paul Zane Pilzer; 2007
• "Health Insurance;" Michael A. Morrisey; 2007

Resources

• Health Insurance In Depth -- How Major Medical Insurance Works