Indemnity Vs. Major Medical

Health insurance offerings are as varied as the people who need them. A great number of people in the United States have "employer-sponsored plans," meaning that they pay for the insurance their employer has set up for them. When looking for private insurance, however, the choices vary widely, and indemnity health insurance and major medical are two of the biggest options.

Total Coverage

• Major medical typically covers all medical visits that you may make ranging from well-child check-ups to a visit for strep throat. Maternity coverage is one area that major medical plans may not cover. Indemnity insurance tends to cover only significant problems. Blood work, tests, and catastrophic events are covered, but this type of health insurance may not cover routine visits.

Cost of Premiums

• Indemnity insurance tends to be more expensive because it does not typically cover routine visits, the cost is high when people do use it. Second, indemnity doesn't negotiate down rates with providers the way administrators of major medical plan do. Major medical premiums can range from less than $100 to several hundred, depending on the coverage, deductible and medical history of the applicant.

Choice of Provider

• Major medical insurance works like the insurance most people know. There is a "network" of doctors, and seeing people within this network will cost you less. You can usually choose non-network providers and pay a slightly higher price. With indemnity insurance you can see anyone you like.