Is Supplemental Insurance Necessary?
Having insurance provides a great safety net. But sometimes the insurance isn’t enough to cover all the expenses. This is when supplemental insurance comes to the rescue. It is not a standalone insurance policy, but must be purchased to act with a traditional policy.
How it Works?
Supplemental insurance is not traditional insurance. If you have no other insurance, then you have no need for supplemental insurance. Supplemental policies are purchased to work in tandem with another existing insurance policy. The existing policy is called the primary policy. When the primary policy doesn’t cover every kind of expense or pay for everything that a policy holder may need, the supplemental policy picks up the slack. It is basically a way to eliminate gaps in coverage of the first policy.
Major Kinds of Supplemental Coverage
The most common form of supplemental coverage is supplemental health insurance. Healthcare costs are astronomical, and most primary insurance policies only cover a portion of the expense. Supplemental health insurance takes care of expenses not covered by a primary health insurance plan.
Another type of supplemental coverage is unemployment insurance. Unemployment insurance is provided by the government to people who have lost their jobs. A portion of the income will be covered until the person finds a new job. Supplemental unemployment insurance can help because it, along with the unemployment coverage, will provide a significant amount of income.
Who Needs Supplemental Coverage
Supplemental coverage is recommended for people at risk of high out of pocket costs due to not enough insurance. Examine your existing insurance policies. If you feel your existing coverage is not sufficient to cover certain mishaps, then supplemental coverage is something to consider.