Guide to Hospital Indemnity Insurance

June 27, 2018

Spending time in the hospital is bad enough.


Knowing that the inevitable bills are coming is like adding insult to injury.

Even with health insurance, your out-of-pocket costs can be excessive.

Without coverage, look out.

The rising costs of hospital stays may be reduced with a hospital indemnity insurance plan.

Here’s what you need to know.

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What is hospital indemnity insurance?

Hospital indemnity insurance – also called hospitalization insurance – will pay you benefits when you have a hospital stay.

Depending on the policy, other medical services may be covered.

Why do I need hospital indemnity insurance?

Your initial instinct may be to think Do I really need another healthcare policy?

Here’s why the answer may be a resounding “Yes.”

  • Health insurance might not cover all your hospital bills. If you have a high deductible, you may end up being responsible for a day or more of your hospital stay.
  • Life is unpredictable. Sometimes illnesses strike or an injury happens and you’re unexpectedly sidelined. As a whole, Americans are woefully financially unprepared for emergencies.
  • Hospital indemnity plans often include critical illness insurance. Critical Illness Coverage will help with your costs associated with cancer, heart attack or stroke. You’ll receive a lump sum payment that can be used for anything from childcare to moving expenses or transportation.

What are the benefits of a hospital indemnity policy?

But it can cover some of the gaps.

Each individual policy will vary, but here’s what you can count on hospital indemnity insurance to cover for you.

  • Hospital stays
  • Time in the Intensive Care Unit
  • Critical Care Unit stays

There are also some plans that cover even more.

  • Outpatient surgery
  • Continuous care
  • Outpatient x-rays and lab work
  • Outpatient diagnostic imaging procedures
  • Ambulances
  • Emergency rooms
  • Doctor’s office visits

What is the cost?

Many factors go into determining how much you’ll pay for hospital indemnity insurance.

Your choice of plan, age, gender, and maybe even your tobacco use will come into play.

Frequently asked questions

Here are some of the most common questions people have about hospital indemnity insurance.

Is there a waiting period?

While there are variances according to the policy, in general, you’ll have a waiting period to meet before you can use your benefits.

How are the benefits paid out?

Hospital indemnity plans pay in cash benefits, which means the amount you are owed is sent directly to you – and not the hospital or doctor.

Can you add dependents?

There are some plans that allow adding dependent children.

Keep in mind, there will be an additional monthly premium for the addition.

Where can you purchase hospital indemnity insurance?

You can obtain coverage through independent health insurance advisors.

They will be able to help you choose the right plan and a benefit amount that’s just right for your household’s needs.

Is there an enrollment period?

You can enroll in a hospital indemnity plan at any point during the year because it’s not part of the Affordable Care Act.

The hospital indemnity insurance solution

You can’t predict what’s coming around the next bend in life.

What you can do is be prepared.

With hospital indemnity insurance, you and your loved ones can protect your health and your financial future.

Can you see how hospital indemnity insurance could be a great gap-filler for you?