Final answer:
b) Catastrophic insurance Catastrophic insurance is designed to cover the high costs associated with severe or prolonged illnesses and disabilities, and serves as a financial safety net beyond regular health insurance. Insured individuals pay premiums, and in return, receive financial support in worst-case health scenarios.
Step-by-step explanation:
Health insurance that provides protection against the high cost of treating severe or lengthy illnesses or disabilities is called catastrophic insurance. This type of insurance is designed to ensure that individuals or families are protected from the significant financial burden that may arise from major health issues. Unlike regular health insurance, which covers a broad range of healthcare services, catastrophic insurance primarily focuses on providing coverage for worst-case scenarios, such as serious accidents or life-threatening illnesses.Insurance, in general, serves as a financial safeguard for insured individuals who make regular payments called premiums. Insurance companies calculate these premiums based on the likelihood of certain events occurring within a pool of people.
Should a member of the insured group experience a catastrophic health event, they would receive payments to alleviate the financial strain.The health insurance that provides protection against the high cost of treating severe or lengthy illnesses or disabilities is called catastrophic insurance. Catastrophic insurance is designed to cover major medical expenses that exceed a certain threshold, usually with higher deductibles and lower monthly premiums. It protects individuals from the financial burden of unexpected and costly medical events.