What Is Primary Insurance?

Insurance coverage comes in countless varieties, with the numerous names and labels only adding to the confusion. One such term, primary insurance coverage, relates to most types of insurance and serves to indicate your core insurance protection. Primary insurance should not be confused with secondary or supplemental insurance plans.


Primary insurance coverage protects against medical expenses, property loss or other liability up to the policy’s limit, regardless of whatever other insurance you hold. The primary insurance coverage always kicks in first before any secondary insurance coverage begins. Such secondary policies come into play only once the primary insurance coverage has been completely exhausted.


Primary insurance coverage must always cover expenses regardless of whatever other coverage you may own. Simply because you possess secondary insurance does not excuse the primary insurer from covering all expenses up to the policy’s maximum limit. Owning more than one policy requires coordination of benefits to avoid multiple payments for the same claim. For instance, if each spouse has an insurance policy through work, each spouse’s own individual policy would be his primary policy, while the spouse’s policy would be designated the secondary policy.


Medicare is a form of primary insurance coverage. When individuals 65 or older with Medicare incur medical expenses, the doctor or hospital bills Medicare first. Medicare pays all the bills up to its maximum coverage limit. Once the expenses exhaust the Medicare coverage, then any secondary policies or supplemental coverage can pick up additional expenses.


Many people get confused when trying to determine the difference between primary, secondary, supplemental or excessive insurance coverage. Primary insurance provides the basis for all your insurance coverage, acting as your sole protection until its top limit is reached. Once exhausted, primary insurance coverage gives way to either secondary or supplemental coverage. Secondary insurance coverage typically comes into play when one insured spouse is listed as a dependent on the other spouse's primary plan. Secondary coverage may pick up a portion of the primary plan's unpaid bills or even provide benefits the primary plan lacked, such as mental health coverage or dental.
Supplementary insurance, sometimes called excessive insurance, only extends the primary insurance plan, covering amounts above the original plan’s limit. Unlike secondary insurance, supplementary insurance does not cover anything the primary plan lacked; it's merely an extension of the primary plan.