Hospital indemnity insurance is a supplemental plan that can help relieve out-of-pocket costs if you have an expensive, unplanned hospital stay. As a policyholder, you choose a plan based on a specified, fixed-amount benefit for each day you’re confined to a hospital as a result of a covered sickness or injury. You typically choose a per-day cash benefit amount and a benefit period, which is the maximum number of days the policy will pay. Hospital indemnity insurance generally has no deductible nor does it limit the providers you can see. Benefits can usually be spent in whatever way you choose—from medical bills to household expenses.

 
What sets hospital indemnity insurance plans apart are the additional benefits and riders that pay for services beyond hospital confinement. These benefits offer extra value at no additional charge and are, at times, added to a hospital indemnity plan to cover one of four service categories: services provided before, during, or after inpatient hospitalization, or services provided during outpatient hospitalization.