BEST Supplemental Life Insurance [GET A QUOTE TODAY]

BEST Supplemental Life Insurance [GET A QUOTE TODAY]

  • Supplemental life insurance is additional insurance bought by a current policyholder.
  • The purpose in acquiring additional insurance is to increase coverage, either because the insurance need has increased or because it has changed in scope.
  • Supplemental life insurance will often be purchased under a provision in the existing policy that allows it.
  • Whether you have a life insurance policy through work or a private insurance company, you can get more coverage with supplemental life insurance at a reasonable price.


Do You Need Supplemental Life Insurance?

  • Supplemental life insurance is another form of additional life insurance.
  • It’s not meant to take the place of your primary policy or a good term life insurance policy.
  • But it will give your family additional coverage should the worst happen to you.
  • You can get supplemental life insurance two ways: through your employer, or privately. 
  • Sometimes you can get a supplemental term policy through your employer. 
  • The benefit of getting it through your employer is it may be less expensive because it is usually covered through group coverage which in turn costs you less.
  • However, the negative of buying through your employer is that you may be limited (capped) on your death benefit. 
  • Here’s the bottom line – do you need additional coverage, and can you afford it? If you’re exclusively shopping on the private market, consider adding supplemental insurance to your life insurance policy, but sit down with a broker who can offer you many choices, explain your benefits and clarify terminology.


Can I Get Supplemental Life Insurance Through an Employer?

  • Many employers will offer supplemental life insurance for purchase.
  • Since you are purchasing the policy through your employer, it could be slightly cheaper than purchasing individual life insurance.
  • However, your company technically owns the policy.
  • Therefore, if you quit or are fired, your group life is gone, too. Some employers will give you the option to continue carrying the policy after you leave, but it will be at a higher price.

Individual Life Insurance Versus Group Life Insurance

  • While signing up for free group life insurance is a must, it is much better to sign up for supplemental term life insurance individually.
  • The policy will stay with you even if you move jobs. Furthermore, you can lock in a low premium now when you are still young and healthy.
What is the difference between Basic Life And Supplemental Life insurance?
  • Basic life insurance is generally consider to be either whole life or term life insurance coverage. Supplemental life insurance is when a rider is purchased to increase the value of the policy without taking out a new life insurance policy altogether.
  • Supplemental insurance is not usually available on a term life policy because that type of coverage is already constrained within certain defined limits and conditions,but is more often taken out to supplement a whole or variable life insurance policy, resulting in a higher claim value when the policy matures.
  • Supplemental life insurance is not a complete insurance policy,but is used to increase the value of existing policies.
  • For example, if you had a whole life policy that was valued at $100,000 and your net worth has increased, you may want to take out a supplemental life insurance policy to cover the difference between your original policy and your current insurable value, to make sure that your loved ones are properly cared for when the time comes.
  • The advantage of a supplemental life insurance policy is that the supplemental coverage can be dropped at a later date without sacrificing the original coverage.
  • If your financial situation deteriorates and it is no longer feasible to carry the supplemental coverage, you can drop the additional coverage and only lose a small percentage of the premiums you have paid rather than the entire policy.
  • Being supplemental, the coverage may also be transferable to other policies offered by the company, but it is best to assume that your supplemental life insurance applies to the current policy and will be lost if the account is allowed to go into default.
What is a Supplemental Term Life
  • Supplemental term life is coverage you can add onto your basic group policy.
  •  It’s usually offered in increments of $10,000 or $25,000, up to a specified amount.
  • Most policies allow the employee to purchase some additional coverage without providing evidence of insurability, which can be a benefit if you’re a substandard risk for conventional insurance.
  • Additional amounts are usually available if you can pass a physical examination.
  • This supplemental coverage can increase your group policy to meet your long-term life insurance needs, or you can use it for transient protection against loans or other short-term liabilities.

How to Buy Supplemental Life Insurance

  • When purchasing supplemental life insurance, pay attention to the cost of the additional insurance.
  • It is common for the supplemental insurance to be a convertible term policy added to the base policy.
  • However, some companies use an annual renewable term life policy as the supplement.
  • These policies can be quite expensive over time as the cost of insurance is guaranteed to rise as you become older.
  • Premiums could easily eclipse the base policy premium amount if you’re not careful.

Supplemental Life Costs and Portability

  • In the event that a policy holder decides to purchase a supplemental life insurance policy through their employer, it is quite important to note that this particular add-on cannot be transported to a new place of employment in the event that the policy holder leaves their current place of work.
  • With that in mind, individuals should carefully assess their own long-term employment plans to determine whether or not an employee-sponsored supplemental life insurance policy does indeed fulfill their needs.

Pros and Cons of buying through your Employer

  • The premiums for group life coverage are based on the size and overall demographics of the group.
  • If you’re a poor insurance risk, or if you’re older than the average of the group, the premiums can be attractive.
  • However, if you’re in good health and younger than the group, private life insurance can be cheaper.
  • A bigger issue is that your employer owns the group policy, so coverage and terms can change without your consent, and you may lose the coverage if you leave the job.
  • For your long-term peace of mind, it’s often better to purchase a private life insurance policy that you control, and use the group plan as your supplemental coverage.

Term Riders Of Life Insurance

  • Choosing private coverage doesn’t mean you give up the ability to add extra term life insurance to meet transient needs.
  • Both term and permanent insurance policies usually provide the option of additional coverage for a specified period, treating it as an option or “rider” on your base policy.
  • These are typically cheaper than purchasing a second policy, since you already paid the policy fees when you bought the original coverage. These riders can be useful for covering financial obligations such as student loans or a mortgage.

GET A FREE Supplemental Life Insurance TODAY!

If you’re young and healthy, term life insurance policy is likely to be an affordable way to protect your family. To find out how affordable, get a free quote at Mintco Financial.

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