What is the process called that resolves conflicts when a claimant is covered by more than one insurance plan?

The process that resolves conflicts when a claimant is covered by more than one insurance plan is known as coordination of benefits. This mechanism is utilized to determine the order in which multiple insurance policies will pay out benefits for the same claim. The objective is to ensure that the total benefits received do not exceed the actual expenses incurred by the claimant.

Coordination of benefits establishes which insurance plan is primary and which is secondary when multiple policies are involved. The primary plan pays first, covering its contractual obligations, and the secondary plan may then pay remaining eligible expenses up to its limits. This prevents overpayment and ensures that the claimant receives the maximum benefit without exceeding their actual costs.

Understanding coordination of benefits is crucial for both insurers and claimants to navigate complex situations where multiple policies apply, ensuring proper benefit distribution and helping to avoid complications in claims processing.