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Health Insurance

DEFINITION of 'Health Insurance'

A type of insurance coverage that pays for medical and surgical expenses that are incurred by the insured. Health insurance can either reimburse the insured for expenses incurred from illness or injury or pay the care provider directly. Health insurance is often included in employer benefit packages as a means of enticing quality employees. INVESTOPEDIA EXPLAINS'Health Insurance'

The cost of health insurance premiums is deductible to the payer, and benefits received are tax-free. Health insurance has many cousins, such as disability insurance, critical (catastophic) illness insurance and long-term care (LTC) insurance. Refine Your Financial Vocabulary

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Group Health Insurance Plan

DEFINITION of 'Group Health Insurance Plan'

An insurance plan that provides healthcare coverage to a select group of people. Group health insurance plans are one of the major benefits offered by many employers. These plans are generally uniform in nature, offering the same benefits to all employees or members of the group.

INVESTOPEDIA EXPLAINS'Group Health Insurance Plan'

Group health insurance plans usually cost less for participants than individual plans that offer the same benefits. This is because the risk is spread over the entire group, rather than one person. If the cost of premiums is borne by the insurer, then they are fully deductible, while any benefit received by group members is tax free.

Universal Health Care Coverage

DEFINITION of 'Universal Health Care Coverage'

An organized healthcare system that provides healthcare benefits to all persons in a specified region. Many countries, such as Canada and Germany, provide universal coverage to all of the country's inhabitants, meaning that all residents are covered for basic healthcare services. In addition, an individual cannot be denied healthcare as long as he or she is a legal resident of the country that offers the universal coverage.

Also called universal healthcare, or just universal coverage.

INVESTOPEDIA EXPLAINS'Universal Health Care Coverage'

As with any type of insurance, there are a large group of payers, and only a few need a large amount of money quickly at any given time. The more contributors there are, the lower the payments are. The United States is the world's only wealthy, industrialized nation that does not have healthcare accessible to all members of society through a universal coverage program.

Opponents have criticized this program over concerns that it would raise taxes, but proponents argue that it would provide healthcare to more individuals and decrease instances of bankruptcy due to medical costs.

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