Supplemental insurance typically refers to supplemental health insurance, insurance policies that pay out cash directly to the person insured. Supplemental insurance may be a good idea for people who are unable to get or who need benefits not provided by standard health insurance.
Supplemental insurance pays cash benefits to the policyholder when the insured is injured, hospitalized, visits a doctor or has other health-related expenses described in the policy.
Supplemental insurance is also known as "defined benefit insurance" because each policy defines the exact amount to be paid out for each benefit covered rather than tying the amount to the amount charged by the health insurance provider.
Supplemental insurance pays out cash benefits even if medical costs are completely covered by other insurance. Many supplemental insurance policies pay out benefits for pre-existing conditions after a waiting period.
Benefits paid by supplemental insurance policies are paid directly to the policyholder and can be used for any purpose by the policyholder.
Supplemental insurance is a good idea if the amount of the premiums paid in does not exceed the typical out-of-pocket expenses and losses related to medical care. It is also a good idea for those who have inadequate health insurance coverage or face large co-pays and high deductibles for hospital and doctor visits.
Medigap supplemental insurance policies are specifically designed to provide benefits for things not covered by traditional Medicare insurance.
- Photo Credit Image by Flickr.com, courtesy of Eric Jusino
What Is Medicare Supplemental Insurance?
Medicare recipients have the option of obtaining additional insurance to help defray costs not covered by Original Medicare. These supplemental policies should...
Do I Need Supplemental Insurance for Medicare?
Supplemental Medicare insurance, also known as Medigap, is an option for people already enrolled in Medicare Part A hospital and Part B...