Answer :
Final answer:
The cost that is always involved when buying insurance is the premium, which is the periodic payment made to maintain coverage. Other costs like deductibles, co-payments, and payouts vary based on the insurance policy. Understanding these terms helps in managing your insurance effectively.
Explanation:
Understanding Insurance Costs
When purchasing insurance, there are several costs involved, but the one that is always present is the premium. The premium is the amount you pay periodically (monthly, quarterly, or annually) to maintain your insurance policy. This is the principal cost of having the insurance, as it secures coverage for insured events.
In contrast, a deductible is an amount paid out of pocket before insurance kicks in, and a co-payment is a fixed amount you pay for specific services or medications at the time of the visit, which may vary based on insurance policy terms. A payout refers to the amount the insurance company pays to cover a claim, usually after the deductible has been met.
Examples of Insurance Costs
- Premium: You pay $200 monthly for your health insurance.
- Deductible: You have to pay the first $1,000 of your hospital bills yourself.
- Co-payment: You pay $30 each time you visit a doctor.
- Payout: Your insurance covers $5,000 after you’ve paid your deductible.
Learn more about Insurance here:
https://brainly.com/question/28562565