This policy will only pay for a semi-private room. This phrase is considered to be a(n):

This policy will only pay for a semi-private room. This phrase is considered to be a(n):

• A. Coinsurance
• B. Deductible
• C. Internal limit
• D. Out-of-pocket maximum

Answer: (C)

The phrase describes an internal limit. An internal limit is a sublimit within a policy that cap­s the payment for a specific benefit or service, such as hospital room charges. Here, the plan restricts coverage to a semi-private room, which is a per-benefit cap inside the overall policy. This is distinct from a deductible (the amount you pay before coverage starts), coinsurance (a share of costs after deductible), and the out-of-pocket maximum (the total you’d pay for covered expenses in a policy period). An internal limit is about how much the policy will pay for a particular benefit, not about the timing of payments or overall annual spending.

The phrase describes an internal limit. An internal limit is a sublimit within a policy that cap­s the payment for a specific benefit or service, such as hospital room charges. Here, the plan restricts coverage to a semi-private room, which is a per-benefit cap inside the overall policy.

This is distinct from a deductible (the amount you pay before coverage starts), coinsurance (a share of costs after deductible), and the out-of-pocket maximum (the total you’d pay for covered expenses in a policy period). An internal limit is about how much the policy will pay for a particular benefit, not about the timing of payments or overall annual spending.