Health insurance in a general sense is a form of protection that covers your medical expenses. In a broader sense, it includes disability coverage, long-term nursing or needs for custodial care.
Insurance programs may be issued through government sponsor, employer purchased coverage or individual purchase. In every instance, groups or individuals covered pay premiums or taxes in order to protect the insured from paying unexpected health expenses. Government welfare programs may also pay for medical expenses instead of being shouldered by the beneficiaries.
Calculating the overall risk of healthcare expenses and developing a routine finance structure that ensures payment of benefits specified in the insurance agreement is how health insurance works. Administration is handled by a central organization that is either a government agency or a private entity.