Supplemental benefits complement medical insurance, which can run out in the event of an accident or illness and leave you to pay out-of-pocket for treatments and other costs.

Let's look at the types of supplemental coverage and what it will cost you. 

Accident/AD&D

In the event of an accidental death, this insurance will pay benefits in addition to any life insurance but only up to a set amount total regardless of any other insurance held by same insurer, held by the client. This is called double indemnity coverage and is often available even when accidental death insurance is merely an add-on to a regular life insurance plan. Some of the covered accidents include traffic accidents, exposure, homicide, falls, heavy equipment accidents and drowning. Accidental deaths are the fifth leading cause of death in the U.S.  

Fractional amounts of the policy can be paid out if the covered employee loses a bodily appendage or sight because of an accident. Additionally, AD&D generally pays benefits for the loss of limbs, fingers, toes, sight and permanent paralysis. The types of injuries covered, and the amount paid vary by insurer and package and are explicitly enumerated in the insurance policy.

Critical Illness Insurance

Otherwise known as critical illness typically covers heart attack, cancer, stroke or a dreaded disease. It is an insurance product in which the insurer is contracted to typically make a lump sum cash payment to the insured if the policyholder is diagnosed with one of the specific illnesses on a predetermined list as part of an insurance policy.

Disability Insurance

Often called DI or disability income insurance, or income protection, is a form of insurance that insures the beneficiary’s earned income against the risk that a disability creates a barrier for a worker to complete the core functions of their work. For example, the worker may suffer from an inability to maintain composure in the case of psychological disorders or an injury, illness or condition that causes physical impairment or incapacity to work. It encompasses paid sick leave, short-term disability benefits and long-term disability benefits. Statistics show that in the US a disabling accident occurs, on average, once every second. In fact, nearly 18.5% of Americans are currently living with a disability and 1 out of every 4 persons in the US workforce will suffer a disabling injury before retirement.

Long Term Care (LTC)

Long term care (LTC) refers to the assistance that people with serious illness, injury, or cognitive impairment require with activities of daily living. This skilled care is provided by nurses, therapists, or other healthcare professionals.  Long Term Care insurance comes in 3 forms:

Traditional long term care insurance (LTCi) is designed to help cover expenses of long term care (LTC) services not covered by health insurance, Medicare, or Medicare Supplement Insurance. Services include personal and custodial care in a variety of settings such as the home, adult day care facilities, assisted living, nursing facilities, or hospice.

Multi-life policies provide coverage to employees usually provided by the employer. At one time, the only way for employers to offer standalone long-term care insurance was using group plans. Now, most long term care insurance sold through the employer is offered as individual contracts—thus the name “multi-life” LTC, and often are offered at a discount. 

Linked benefit products offer many advantages to consumers that traditional LTCi products don’t, such as tax-free benefits, no future rate increases, and flexibility in contributions and benefits. They also provide consumers and financial professionals an opportunity to create a plan that is priority-driven and supported by contributions from asset reallocation or cash flow.