Lifetime Policy Limit

Lifetime Policy Limit

Some health insurance companies establish lifetime policy limits that define the maximum amount the insurer agrees to pay for a policyholder’s medical expenses. For example, a policy with a $500,000 limit pays up to $500,000 toward covered medical expenses over the life of the policy. A policy covering as much as $1 million or more of medical expenses usually does not cost the policyholder much more in premiums than one with $250,000 or $500,000 limits. The difference in cost is so slight because the probability of needing the highest amounts of coverage is very small. If the cost of medical services exceeds the lifetime policy limit, the insured person is liable for the difference, regardless of the limits set by the out-of-pocket maximum.

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