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Background and Motivation: COVID-19 has resulted in a massive loss of life during the last two years. The current imaging-based diagnostic methods for COVID-19 detection in multiclass pneumonia-type chest X-rays are not so successful in clinical practice due to high error rates. Our hypothesis states that if we can have a segmentation-based classification error rate <5%, typically adopted for 510 (K) regulatory purposes, the diagnostic system can be adapted in clinical settings. Method: This study proposes 16 types of segmentation-based classification deep learning-based systems for automatic, rapid, and precise detection of COVID-19. The two deep learning-based segmentation networks, namely UNet and UNet+, along with eight classification models, namely VGG16, VGG19, Xception, InceptionV3, Densenet201, NASNetMobile, Resnet50, and MobileNet, were applied to select the best-suited combination of networks. Using the cross-entropy loss function, the system performance was evaluated by Dice, Jaccard, area-under-the-curve (AUC), and receiver operating characteristics (ROC) and validated using Grad-CAM in explainable AI framework. Results: The best performing segmentation model was UNet, which exhibited the accuracy, loss, Dice, Jaccard, and AUC of 96.35%, 0.15%, 94.88%, 90.38%, and 0.99 (<i>p</i>-value <0.0001), respectively. The best performing segmentation-based classification model was UNet+Xception, which exhibited the accuracy, precision, recall, F1-score, and AUC of 97.45%, 97.46%, 97.45%, 97.43%, and 0.998 (<i>p</i>-value <0.0001), respectively. Our system outperformed existing methods for segmentation-based classification models. The mean improvement of the UNet+Xception system over all the remaining studies was 8.27%. Conclusion: The segmentation-based classification is a viable option as the hypothesis (error rate <5%) holds true and is thus adaptable in clinical practice.