Supplemental group and voluntary benefits help with paying additional medical expenses. (The terms supplemental insurance and voluntary insurance are interchangeable.) Supplemental group insurance policies are insurance policies that enhance an existing traditional benefit coverage, such as health insurance, retirement, vision, and dental insurance. A voluntary benefit is also a supplemental insurance policy, and is offered through an employer but has no direct costs to that employer.
Group coverage refers to insurance that covers a group of specific people. They can be members of a professional society or association or the employees of a company or organization. The advantage of being in group coverage is the benefits are typically more affordable and a wide choice of insurance plans can be available for the participants.
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Employers providing group health insurance may also be more likely to add supplemental insurance.
Better rates under a group plan
Insurance companies can provide better rates for groups. The larger the pool of people in the group, the lower the risk, which underwriters and insurance companies rate more favorably. Depending on the group, premium rates are typically less than individual insurance premiums. Employers with 50 or more employees must purchase group health insurance.1 Employers providing group health insurance may also be more likely to add supplemental insurance.
Added benefits helps with employee retention
It’s an added benefit to support and help employees and their families with additional insurance benefits at no or low cost. Employers may retain employee by offering supplemental and voluntary benefits.2
Types of supplemental group and voluntary benefits
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1. Accident insurance
You can’t predict an accident, but you can prepare for one. An accident insurance policy can help offset some of the costs of hospital stays, emergency treatment, and costs associated with an accident. Accident insurance policies may cover accidental deaths as well. Accidental death insurance may also be available as a stand-alone policy. It can help provide coverage in the event of a fatal accident as described in the policy, such as falls, poisoning, and a death while traveling and other common and unintentional deaths.
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2. Life insurance
Life insurance as a group supplement or as a voluntary benefit is a great add-on for employees. Many times, being in a group insurance plan, the rates are more affordable than if a person buys an individual insurance policy on their own.
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3. Critical illness insurance
Critical illness insurance can help someone who has gone through a major illness, such as heart attack, stroke, organ transplant, or other illnesses that fall within the list of defined critical illnesses within the policy. This insurance benefit may be a lump sum amount of cash to help with additional costs of hospital stay or used how the insured wishes. Critical illness insurance does not typically cover cancer.
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4. Cancer insurance
With one in 10 people diagnosed with cancer in their lifetime, offering a cancer insurance policy through your group adds value to employees.3 Cancer insurance benefits can be paid out in different ways: Upon initial and confirmed diagnosis of cancer, a lump sum is paid according to the coverage limits of the policy, or it is paid out in a series according to the costs that arise from covering the illness. Some cancer diagnoses are not covered in a cancer insurance policy, so it is important to check the details of the policy with a licensed insurance agent. With some pre-existing diagnosis, always check your policy for details. You may not be covered under the cancer insurance policy.
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5. ICU insurance
Intensive Care Units can be very expensive. If you or a loved one are hospitalized in an ICU, the costs can run into the tens of thousands per day. ICU insurance can help with some of these costs.
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6. Disability Income insurance
Disability Income insurance provides coverage if you become disabled from an accident, or an illness prevents you from returning to work. Disability insurance provides benefits to replace some portion of the insured’s income lost while recovering from the illness or injury.
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7. Children’s life insurance
For less than the price of a cup of coffee, children’s life insurance may be purchased as a group coverage. It typically insures the child from birth through high school and sometimes college years.4 That price is locked in regardless of future health changes. Some children’s life insurance builds cash value.
Supplemental insurance and voluntary benefits are products provided by a group or employer and should be considered if your group or employer offers it.