What typically needs to be met before insurance coverage can start?

Before insurance coverage can commence, it is essential for the insured individual to meet the deductible. The deductible is the amount that the insured must pay out-of-pocket for healthcare services before the insurance begins to cover the costs. This requirement ensures that the insured takes on a portion of the financial responsibility, which helps to lower the costs of insurance premiums and discourages unnecessary use of healthcare services.

Once the deductible is met, the insurance company then starts to pay for covered services, allowing the insured to access benefits according to the terms of their policy. The out-of-pocket maximum, premium, and copayment serve different functions within the insurance framework; for instance, the premium is the regular payment made to maintain the policy, while copayments are fixed amounts paid for specific services. However, none of these terms relate to the initial requirement for coverage to begin as directly as the deductible does.