What is the main feature of catastrophic insurance?

The main feature of catastrophic insurance is that it specifically provides coverage for severe or catastrophic losses, typically associated with significant health-related expenses or disasters. This type of insurance is designed to protect policyholders from financial devastation due to unforeseen and high-cost events, such as serious illnesses, major accidents, or natural disasters.

Catastrophic insurance policies usually come with high deductibles, meaning that the insured must pay a substantial amount out of pocket before the insurance coverage kicks in. This structure helps to keep the premiums low, making it an appealing option for those looking to safeguard against potential financial ruin from significant expenses rather than covering everyday medical costs or minor losses. It primarily focuses on shielding the insured from life-altering financial burdens rather than routine or less severe situations that might be covered by other types of insurance.