What is supplemental insurance? To understand how it works this is the first piece to that puzzle. Supplemental insurance is NOT insurance; that means it does not qualify as major medical insurance recognized by the US Government. What it does is supplements what your insurance doesn’t cover with a payment directly to you with whatever type situation you are covered for.
Supplemental Insurance offers: dental and vision, hospital, accident, short term disability, cancer, chronic illness, and more. Now lets take a look at a few examples of those and how they help you.
Accident Coverage
You are riding your bike and you fall, breaking your arm. You head to the emergency room where they fix your arm and send you on your way. When you get there you give them your major medical insurance card which will be billed. You will have a copay due at the time of service or billed at a later date.. Depending on the charges the ER submits all or part of it may be covered by the insurance, if they don’t cover all of it the ER will bill you for the balance. You have Aflac though, so you make a claim within a day or two of visiting the ER and Aflac will send you X amount of money since you had Accident coverage. You can now use that money to either pay the ER bill, reimburse you for your copay, or use it on something completely different like the electric bill, food, water bill or anything else that you may be short on cash because you were injured.
Cancer Coverage
In the US 1 in 5 people will be diagnosed with cancer. At the age of 55 that number goes to 1 in 2. Cancer coverage is important because being diagnosed the treatments will be devastating to your finances – especially if you can’t work or already retired. Cancer coverage will pay you one lump sum of money that can be 20,000 up to 50,000 depending how much coverage you purchased. You can use that money once diagnosed to pay for treatment or use it to pay rent, electric, water or food bills while you go through treatment.
Dental and Vision
Again, this is a supplemental insurance. This works as actual insurance where you pay a copay and possibly out of pocket for amounts not covered by the insurance. Its a supplemental because most major medical does not include vision and dental in your coverage, so it fills a gap in your current coverage.
So as you can see supplemental insurance can help you through a bind after an unexpected accident, chronic health condition, cancer or whatever else you may encounter. Being prepared is so important because one trip to the ER could cost you your life savings and even tap into your retirement fund.
