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What Is Coinsurance? Definition & Examples

By Kristi Waterworth – Updated Jul 1, 2025 at 2:21 AM EST

Key Points

Coinsurance is a split cost between you and your insurer after meeting your deductible.
Copays are fixed upfront charges that apply before meeting your deductible.
Property insurance coinsurance affects claim payouts if underinsured.

When you're dealing with insurance, it's important to understand what it is you're agreeing to pay. Coinsurance is one component in determining the final amount due from you to your medical providers. Read on to learn more.

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Health insurance document, stethoscope, and bills. — Image source: Getty Images.

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Health Insurance Copayment

A fixed, predetermined amount that a person with health insurance pays out-of-pocket for covered services.

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Many homeowners insurance policies require owners to maintain 80% or more of the property's replacement value in insurance. Otherwise, the insurer may not completely cover a claim. You'll need to work with your insurance agent to determine what that figure is for your plan and how much insurance you actually need on your home.

If you fail to maintain the minimum coverage, the coinsurance formula kicks in and decides how much of your loss will come out of your pocket beyond your deductible.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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