Deductible vs CoPay

What is Deductible?

A deductible meaning, it is the amount of money that you, the policyholder, must pay out of pocket before your insurance company starts to cover expenses.

What is Copay?

Copayment or Copay meaning, is a cost-sharing arrangement in Insurance where the insured person pays a fixed amount or a fixed percentage of the medical expenses out of pocket each time they access a covered healthcare service. The insurance company pays the remaining portion of the bill.

Key differences between Deductible and Copay?

Deductible and Copay are both forms of cost-sharing in insurance, but they function differently and apply at different stages of your healthcare journey.

Feature	Deductible	Copay (Copayment)
Payment	made before insurance coverage begins for major expenses.	At the time of claim; not always tied to deductible.
Application	Applies to a broad range of covered services, especially major medical costs.	Applies to specific services (e.g., doctor visits, prescriptions).
Example	Deductible Example : If your deductible is Rs. 10,000, you pay the full expenses until you reach Rs. 10,000; after that, insurance starts paying.	Copay Example: If your copay is 10% and expenses are Rs. 50,000 then you pay Rs. 5,000.
Effect on Premium	Higher deductibles usually mean lower premiums.	Higher copays can also mean lower premiums.

Can they work together?

Coinsurance: After the deductible is met, you may pay a percentage of the cost of services (coinsurance), while the insurer pays the rest.

Examples

You have a Rs. 10,000 deductible & 10% co-pay in your insurance.

Let say your medical bill is Rs. 50,000. 

• Since deductible is Rs. 10,000. you have to pay that
• Then since copay is 10%, from the remaining Rs. 40,000 (50K-10K) you pay 10%. i.e. Rs. 4,000
• In total you have to pay Deductible + Copay = Rs. 10,000 + Rs. 4,000 = Rs. 14,000
• The insurer pays the rest amount i.e. Rs. 36,000 (assuming every expenses is covered part of the insurance).

Additional information

• Copays and deductibles can both lower your insurance premium, but they increase your out-of-pocket costs when you need care.
• Copays are not always credited toward your deductible; check your plan details.
• After meeting your deductible, you may still have copays or coinsurance for certain services.

Understanding both terms helps you better manage your healthcare expenses and choose the right insurance plan for your needs.

Thanks,

Honvest Team.