Voluntary Benefits
Published by Trustmark Voluntary Benefits on July 1st, 2024
Many people understand the basics of health insurance — it’s coverage that helps pay for medical expenses. However, their understanding is often less clear when it comes to supplemental insurance. For anyone looking to get a better understanding of supplemental insurance, why it’s important, and how to find coverage, this blog will help answer those questions.
Specifically, we will cover:
What is supplemental insurance?
To put it simply, supplemental insurance is additional insurance that helps pay for services and out-of-pocket expenses that your medical insurance doesn’t cover. These policies can provide coverage for various expenses, including copayments, coinsurance, and deductibles. In essence, it acts as an extra layer of financial protection to help you manage unexpected healthcare costs.
Supplemental insurance policies typically work in conjunction with your primary health insurance plan. For example, if your health insurance covers a portion of your hospital stay, your supplemental insurance could help cover the remaining costs, including the deductible and any other out-of-pocket expenses. It helps protect you from substantial medical bills that can cause financial strain. The average cost of a three-day hospital stay is roughly $30,000, according to the federal government’s Healthcare.gov.2 In that situation, having supplemental insurance could be crucial to help with the financial and mental burden you’re going through.
Supplemental insurance can also provide coverage for needs outside of medical expenses. If, for instance, you have life insurance through an employer, supplemental insurance can be a great way to “supplement” that coverage with additional protection. There are lots of different forms of supplemental insurance, so they’re a great way to tailor financial protection to meet your needs.
What types of supplemental insurance are available?
There are several types of supplemental insurance, each designed to cover specific needs and circumstances. Here are some common types:
Why is supplemental insurance important?
When faced with the unexpected, the financial impact can be significant. Supplemental insurance is important because it helps fill the gaps left, providing an added layer of security. For example, regarding life insurance, someone with a wife, children, and a $250,000 mortgage will likely be inadequately covered if they are only protected by the $100,000 of coverage, they have through their job. Supplemental life insurance can make a big difference in the lives of surviving family members.1
Supplemental insurance provides several key benefits that are important to policyholders. First, it offers financial protection, as medical expenses can add up quickly even with good health insurance, and supplemental insurance helps cover costs that would otherwise come out of your pocket. Additionally, it provides peace of mind; knowing you have extra coverage can reduce stress and allow you to focus on what’s most important to you rather than worrying about financial burdens.
Supplemental insurance also offers customized coverage, allowing you to choose the type of policy that best suits your needs. For example, you can customize the level of coverage, specific conditions covered, benefit amounts, and duration of benefits. Furthermore, many supplemental insurance plans will pay benefits directly to the policyholder and can be used for a range of expenses, not just medical bills, which can be crucial during a recovery period.
How do you get supplemental insurance?
Supplemental insurance is often available through your employer as part of your benefits package during open enrollment periods, similar to medical insurance. These employer-offered policies can be a convenient and cost-effective way to obtain additional coverage. But this is just one of a few ways to get coverage:
For those who have already decided to purchase supplemental insurance, be sure to explore all your options and read the fine print to understand the coverage details fully. This will help you make an informed decision that provides the financial protection you need.
Hopefully this provides some insight into the often-asked question: “What is supplemental insurance?” By understanding what supplemental insurance is, the types available, its importance, and how to obtain it, you can make better decisions to protect yourself and your loved ones from unexpected financial hardships due to health-related issues.
_________________________________
1Breeze. Supplemental Health Insurance: What is it & How Does It Work. July 2022.
2Forbes. What Is Supplemental Health Insurance. August 2023.
Specifically, we will cover:
- What is supplemental insurance?
- What types of supplemental insurance are available?
- Why is supplemental insurance important?
- How do you get supplemental insurance?
What is supplemental insurance?
To put it simply, supplemental insurance is additional insurance that helps pay for services and out-of-pocket expenses that your medical insurance doesn’t cover. These policies can provide coverage for various expenses, including copayments, coinsurance, and deductibles. In essence, it acts as an extra layer of financial protection to help you manage unexpected healthcare costs.
Supplemental insurance policies typically work in conjunction with your primary health insurance plan. For example, if your health insurance covers a portion of your hospital stay, your supplemental insurance could help cover the remaining costs, including the deductible and any other out-of-pocket expenses. It helps protect you from substantial medical bills that can cause financial strain. The average cost of a three-day hospital stay is roughly $30,000, according to the federal government’s Healthcare.gov.2 In that situation, having supplemental insurance could be crucial to help with the financial and mental burden you’re going through.
Supplemental insurance can also provide coverage for needs outside of medical expenses. If, for instance, you have life insurance through an employer, supplemental insurance can be a great way to “supplement” that coverage with additional protection. There are lots of different forms of supplemental insurance, so they’re a great way to tailor financial protection to meet your needs.
What types of supplemental insurance are available?
- Hospital insurance: Pays benefits directly to you for hospital admissions.
- Disability insurance: Disability insurance provides financial protection to protect your income. It can make payments to you when you are unable to work due to illness or injury.
- Life insurance: Protects families with financial support after the loss of a loved one and, in some cases, can even include living benefits you can use throughout life.
- Critical illness insurance: Critical illness insurance pays you a lump sum payment upon diagnosis of a specified serious illness, such as cancer or heart disease, to help cover medical expenses and other financial needs.
- Accident insurance: Pays you cash directly for treatment for covered accidents, to use however you choose.
- Dental insurance: Covers expenses related to dental care, including routine checkups, cleanings, and more extensive dental procedures.
- Vision insurance: Helps cover the cost of eye care, including exams, glasses, and contact lenses.
- Pet insurance: Helps cover the cost of veterinary bills for your four-legged family members
Why is supplemental insurance important?
When faced with the unexpected, the financial impact can be significant. Supplemental insurance is important because it helps fill the gaps left, providing an added layer of security. For example, regarding life insurance, someone with a wife, children, and a $250,000 mortgage will likely be inadequately covered if they are only protected by the $100,000 of coverage, they have through their job. Supplemental life insurance can make a big difference in the lives of surviving family members.1
Supplemental insurance provides several key benefits that are important to policyholders. First, it offers financial protection, as medical expenses can add up quickly even with good health insurance, and supplemental insurance helps cover costs that would otherwise come out of your pocket. Additionally, it provides peace of mind; knowing you have extra coverage can reduce stress and allow you to focus on what’s most important to you rather than worrying about financial burdens.
Supplemental insurance also offers customized coverage, allowing you to choose the type of policy that best suits your needs. For example, you can customize the level of coverage, specific conditions covered, benefit amounts, and duration of benefits. Furthermore, many supplemental insurance plans will pay benefits directly to the policyholder and can be used for a range of expenses, not just medical bills, which can be crucial during a recovery period.
How do you get supplemental insurance?
Supplemental insurance is often available through your employer as part of your benefits package during open enrollment periods, similar to medical insurance. These employer-offered policies can be a convenient and cost-effective way to obtain additional coverage. But this is just one of a few ways to get coverage:
- Through your employer: Check with your HR department to see what supplemental insurance options are available to you. Enroll during your company’s open enrollment period. If your employer doesn’t offer the coverage you’re looking for, let them know!
- Direct purchase: Contact insurance companies directly or work with an insurance broker to find and purchase a policy that fits your needs.
- Consult a financial advisor: A financial advisor can help you understand your insurance needs and guide you in choosing the right supplemental insurance policies.
For those who have already decided to purchase supplemental insurance, be sure to explore all your options and read the fine print to understand the coverage details fully. This will help you make an informed decision that provides the financial protection you need.
Hopefully this provides some insight into the often-asked question: “What is supplemental insurance?” By understanding what supplemental insurance is, the types available, its importance, and how to obtain it, you can make better decisions to protect yourself and your loved ones from unexpected financial hardships due to health-related issues.
_________________________________
1Breeze. Supplemental Health Insurance: What is it & How Does It Work. July 2022.
2Forbes. What Is Supplemental Health Insurance. August 2023.
Share
Author
Written by Trustmark Voluntary Benefits
We provide innovative voluntary benefits that help our policyholders achieve greater financial security and protect what they care about most. You care. We listen.
Topics