Premiums, deductibles, copays and coinsurance explained

Posted on March 5, 2026 in Healthy You

Insurance can feel like a tangle of strange words, but knowing four basic terms goes a long way toward boosting your confidence in managing your care and costs.

Insurance basics dictionary: Premium, deductible, copay and coinsurance

Below are simple definitions for four main terms that affect what you pay when you visit the dentist or eye doctor:

1. Premium: Your premium is like a subscription fee for your dental or vision plan. It’s the regular payment (often monthly) to keep your coverage active, even if you don’t visit a provider that month. If your employer contributes to your benefits, you’ll pay only your share of the premium.
2. Deductible: A deductible is the total amount you must pay out of your own pocket for covered services before your insurance starts paying. For example, if your plan has a $100 deductible, you’ll pay the first $100 for treatment before your plan contributes.
3. Copay: A copay is a fixed, set dollar amount you pay for specific services. For instance, you might pay a $20 copay for a routine check-up or a $50 copay for a filling. Copays are usually due at the time of service, and the amount doesn’t change based on the total cost of care. Copays typically do not count toward your deductible or your annual out-of-pocket maximum.
4. Coinsurance: Once you’ve met your deductible, coinsurance is how you and your insurance share the cost of care. It’s always a percentage, so it changes based on the total charge for the service (unlike copays, which are fixed dollar amounts). For example, you might pay 20% while your insurer pays the remaining 80% for a covered service.

An example of how these terms work together

Here’s a real-world example to help you better understand these terms.*

You have dental insurance with a $30 monthly premium, a $100 annual deductible and 20% coinsurance for major services.

You need a dental crown that costs $1,000. You first pay a $100 deductible, leaving $900. After that, your insurance covers 80% of the remaining cost, and you pay 20% coinsurance. That means you pay $280 total for the procedure ($100 deductible + $180 coinsurance), while your plan covers the remaining $720. Your monthly premium keeps your coverage active all year.

Need more help? Let’s talk it out

Sometimes, you just need to discuss your plan with a person. Delta Dental of Iowa Customer Service Representatives are here to help explain your coverage and expected costs before you schedule care. You can find the customer service phone number on the back of your Delta Dental of Iowa ID card. A quick call can help you plan with confidence and avoid surprises.

Delta Dental of Iowa members — log in to Member Connection to see your specific benefits and plan details. Don't have a Member Connection account? Click here for instructions on how to register.

*Example is for illustrative purposes only and does not represent actual costs, rates or coverage.