All you Need to Know about the Supplemental Life Insurance Policy

Why do you need Supplemental Life insurance?

Insurance is emerging as an integral part of our lives. There are different types of insurance for the coverage of different types of risks. Such insurance covers risks related to our health, life, assets, and so on. In general, the policies under insurance provide financial support to some extent. There is an additional type of insurance that needs to be considered, which could be worth looking into; Supplemental Life insurance.

According to a survey, in the U.S., most of the companies offer additional or supplemental life insurance, but the employees are not confident enough to adopt such a policy. Here, you’ll get to know more about supplemental life insurance.

What is supplemental life insurance?

Supplemental life insurance is a policy that can be purchased with a traditional life insurance policy as an addition. The policy under this offer cover things like burial costs, accidental deaths, and dismemberment, etc. It is a valuable benefit provided by the company and paid by the company itself. You must check-in with your HR for the information about your policy and be sure to ask what and how risks are covered under the policy. If you are planning to adopt an additional insurance policy offered by your company, here are a few things you need to know.

It is an additional benefit to your life insurance policy. It is wise to combine your additional life insurance with traditional life insurance to enhance your coverage. The amount of coverage required will be determined according to the financial gap your death would leave. It would provide financial assistance to your family. 


As supplemental life insurance is offered by your company, therefore, it is generally job dependent. However, some companies allow you to transfer your policy to a new company or retire. It is important to know that if you transfer your additional life insurance, then term life insurance is the only option for you. Generally, most of the companies do not provide transferability of such policies. Thus, you’ll have to purchase a new policy in a new company, if available.

Accidental Death and Dismemberment(AD&D)

A company might offer you coverage for accidental death and dismemberment insurance, and sometimes life insurance at work. You can add up life insurance coverage for your spouse, domestic partner, or children. The AD&D insurance provides benefits to dependents; however, the caveat is that your death is caused by accident. 

Limitations of Supplemental Employer Insurance 

Employees purchase supplemental life insurance policies through their employers. However, there are certain limitations to the policy provided by a company. First, the coverage may be a form of accidental death and dismemberment insurance, which only provides benefits in case of death, or losing a limb as a result of an accident.

Second, the policy can be a form of a burial insurance policy. The policy covering funeral and burial costs of employees may have a limit between $5,000 and $10,000. The additional life insurance can co-exist with traditional term life insurance to enhance the coverage for your dependents after your death. It is a valuable insurance policy, as it is generally inexpensive.