Have you considered offering supplemental insurance to your employees apart from the standard insurance plans? There are many benefits to providing supplemental insurance for employers as well as employees.
Supplemental insurance helps make your benefits packages more attractive to employees. They can help you attract and retain more qualified and more capable workers and improve your workforce quality.
Furthermore, supplemental insurance is typically paid for by the workers themselves. This means that you won’t incur any additional costs despite offering a more attractive benefits package.
Common supplemental benefits
There are many different types of supplemental benefits available to employees. Some of the most common of these are:
- Disability income
- Critical illness
- Accident coverage
Let’s take a closer look at each one:
Life insurance provides cash benefits to beneficiaries in the event of the employee’s death.
As recently as 2011, the Study of the American Dream conducted by MetLife revealed that over 50% of the respondents didn’t have life insurance coverage. However, more than 80% admitted that the United States’ economic situation has encouraged them to “reevaluate” their priorities. This presumably means that 80% were considering getting life insurance.
Employers may offer life insurance plans for groups or individuals. There are also options for universal and whole life insurance.
Dental insurance is one of the most commonly sought-after employee benefits after medical and prescription drug insurance. Interestingly enough, companies that offer dental coverage to their employees are in the minority. Many small and medium-sized businesses do not offer this type of supplemental insurance at all.
Employers may choose to offer group or individual dental insurance policies. There are also insurance plans that payout depending on the prevailing “reasonable and customary” rates in the dental industry.
Still, other companies choose to base payouts on a predetermined schedule of benefits. This schedule typically outlines specific dollar values for particular procedures.
Disability income insurance
Disability income insurance provides monetary benefits to employees that experience injuries or illnesses that result in their inability to work for a specific period.
As with most types of supplemental insurance, disability income insurance is available for groups or individuals. Employers may also offer this type of insurance on a short- or long-term basis.
With short-term policies, employees usually receive the benefits for predetermined periods of six months to two years. For long-term policies, workers may be eligible to receive benefits for a period of two years or until they reach 65 years of age.
The downside to disability insurance is that it is one of the most difficult supplemental insurance types to obtain. In most cases, there is a high likelihood of being turned down for this type of insurance. The most common reasons why applicants are turned down are:
- Difficulty in proving the applicant’s income
- The inability of the applicant to meet underwriting requirements
- Insufficient time for physical and medical records
- High cost associated with a high-risk occupation
Alternatives for those denied disability income insurance
Because of the high likelihood of being denied disability income insurance, many applicants are compelled to explore other options. Some of the alternatives available to these employees are critical illness insurance and accident coverage insurance.
Critical illness insurance
Critical illness insurance is one of the most recent supplemental insurance types to be introduced in the United States. With this type of insurance, employees receive monetary benefits after being diagnosed with any of several illnesses listed in the policy.
Among the illnesses that would make employees qualified for critical illness insurance are:
- Heart attack
- Kidney failure
The benefits paid out by critical illness insurance are intended to pay the costs associated with such illnesses, many of which may not be covered by medical insurance. This often includes co-payments, deductibles, travel costs, and other expenses.
Unlike disability income insurance, critical illness insurance is relatively easy to avail. Few applicants are denied coverage, and the premiums are usually very affordable.
Accident coverage insurance
Another alternative to critical illness insurance is accident coverage insurance. This type of insurance provides 24/7 coverage to qualified employees. Eligibility for this type of insurance isn’t dependent on occupation, nor does it matter whether the accident occurs on or off the job.
Furthermore, accident coverage insurance will pay off regardless of whether the employee has other types of insurance. The premiums are usually just as affordable as those for critical illness insurance.
These are some of the most common types of supplemental insurance available. As mentioned earlier, there are many benefits to offering these to your employees, so it would be worthwhile to look into them.
About Moody Insurance Worldwide
Moody Insurance Worldwide, a division of Moody & Associates that was founded in 1914, is a leading provider of risk management programs and insurance coverage to individuals and businesses across the East Coast. We write all sizes of businesses, with technical expertise in many key industry areas, and provide personal insurance programs for estates and high net worth individuals. Our licensed, experienced commercial account managers can work with you to determine the coverage that you need at a competitive rate. Contact us today at (855) 868-0170 to learn more about what we can do for you.