Which type of insurance policy provides coverage that pays a set amount per day during hospitalization?

Hospital Indemnity insurance is designed specifically to provide a daily, fixed cash benefit for each day an insured individual is hospitalized. This type of policy serves as a supplemental insurance, helping cover extra expenses associated with hospitalization, such as out-of-pocket costs that traditional health insurance may not fully address, like copayments or deductibles.

Unlike major medical insurance, which covers a wide range of healthcare services and usually pays based on the actual costs incurred, hospital indemnity provides a predetermined benefit amount regardless of the specific costs of hospitalization. This benefit provides a sense of financial security by ensuring the insured receives a confirmed benefit for each day of confinement in a hospital.

The other types of insurance mentioned serve different purposes. For example, term life insurance provides a death benefit to beneficiaries and does not offer any hospitalization coverage. Major medical insurance is broader and covers comprehensive medical expenses, while disability insurance replaces lost income due to a disability but does not specifically offer daily benefits for hospital stays. Thus, hospital indemnity stands out as the suitable choice for coverage that pays a set amount per day during hospitalization.