What is an annual maximum?

An annual maximum is the maximum amount of money that a health insurance policy will pay for medical costs in a given year. It sets a limit on the total amount of coverage the insurance policy will provide. In California, the annual maximums for health insurance policies differ by policy type and usually range from $250,000 to several million dollars. The annual maximum also applies to how much a health insurance policy will pay for each service or procedure. For instance, if the annual maximum is $250,000, the insurance company will only pay up to $250,000 for a policyholder’s medical costs in the given year, no matter how much they add up to. This means that if a policyholder has a medical procedure that costs more than $250,000, they will be responsible for paying the remaining balance themselves. It’s important for policyholders to understand their health insurance policy’s annual maximums before enrolling. This way you can be sure that your medical expenses will be covered, should the need arise.

Related FAQs

What is an exclusion clause?
What is a waiting period?
What is a coinsurance rate?
What is the difference between a PPO and an HMO?
What is an out-of-network provider?
What is the primary care physician rule?
What is a flexible spending account (FSA)?
What is an out-of-network benefit?
What is a health insurance subsidy?
What is a healthcare provider network?

What is an annual maximum?

Related FAQs

Related Blog Posts