Hospital indemnity insurance is a supplemental health insurance plan that pays a cash benefit to the policyholder when they are hospitalized for a covered illness or injury. It can help with the financial burden of a hospital stay by covering unexpected expenses, such as:

• Co-pays and deductibles
• Transportation to and from appointments
• Medical testing
• Therapy and rehabilitation
• Lodging or transportation costs
• Housekeeping and other household bills
• Childcare expenses
• Cost-of-living expenses while recovering 

Hospital indemnity insurance is different from health insurance because it pays the policyholder directly, while health insurance pays providers directly.