Understanding Supplemental Insurance

By Brent Meyer — SafeMoney.com Founder & Editor Reviewed by Licensed Financial Professionals  |  SafeMoney.com — Trusted Since 2011  |  Updated Regularly Quick Answer: Learn about supplemental insurance, its benefits, and when you might need it. Explore your options for a secure retirement today! Editor’s Note: The following is editorial content that has been contributed by Marion R. Hutton.   To some people, supplemental insurance might seem a little redundant. After all, insurance can be considered a ‘just-in-case’ type of financial arrangement, and to augment this precaution with another provisional measure in the form of supplemental insurance might not immediately make sense. However, it is necessary to delve into common insurance policies and how supplemental insurance packages can help you rest easier. With that in mind, this article discusses the basics of what supplemental insurance is, particularly with regard to life and health insurance, and when it is necessary to purchase one. What is It? Supplemental insurance is a broad term for insurance policies and packages that are undertaken on top of existing or insurance policies. These are used to cover expenses that your primary insurance doesn’t, with benefits that pay directly to you and not to medical providers or other insurance partners. AOL explains that supplemental insurance provides coverage where traditional insurance policies typically fall short, a potentially life-saving tool particularly when it comes to health insurance. This is because typical health insurance policies have broad coverage which, while useful for general financial precaution, might not be enough for specific illnesses or medical procedures. In this case, contract limits under traditional insurance packages would mean that not all potential costs would be covered.  In addition to covering these previously unaddressed expenses, The Balance details several other things covered by supplemental health insurance, such as lost wages and other financial needs that arise from illnesses or injuries. These can include everything from out-of-network providers, travel costs, and lodging to housekeeping, childcare, and groceries. Supplemental life insurance works the same way. It fills in the large gaps left by more common and affordable term life insurance , while giving the protection benefit of whole life insurance packages without a considerable financial commi