What is a key feature of catastrophic health insurance?

Catastrophic health insurance is designed primarily for young and healthy individuals who want to protect themselves against high medical costs while not needing regular health services. One of the most distinctive features of this type of insurance is that it typically has low premiums coupled with high deductibles. This structure makes it more affordable on a monthly basis, which appeals to those who may not have significant medical expenses throughout the year.

Individuals with catastrophic plans ultimately pay a higher out-of-pocket cost before the insurance coverage begins to contribute significantly, usually after the deductible is met. This plan is beneficial in the event of a severe illness or accident, where the costs could be substantial and would surpass the deductible, allowing the insured to benefit from significant financial protection afterward.

In contrast, the other options either suggest features that are not characteristic of catastrophic insurance or misrepresent its focus. For example, covering routine medical visits with no deductible is more indicative of comprehensive or preventive plans rather than catastrophic coverage. Unlimited coverage for all medical conditions does not accurately describe catastrophic insurance, as there are usually limits to coverage per condition once the deductible is met. Lastly, while preventive care is essential, catastrophic insurance tends to emphasize protection against catastrophic events rather than focusing strictly on preventive services.