Individual Ancillary Coverage Plans

Possible the single most important benefit after health insurance. If you are out sick for 1-2 months, your savings may be enough to cover your living expenses, but it may not. This benefit will pay you after an elimination period. This period will depend on how much coverage you want and how much you are willing to pay for it. It will pay up to $1,000-$1,500 a week for 12-13 weeks or longer. If the illness of injury continues beyond the scope of the short term policy, long term disability kicks in. LTD will pay you upwards of $6,000-$10,000 a month for the next 5 years or all the way to social security normal retirement age (SSNRA). This ensures that you are never at a loss for income if they are disabled. A couple of notes, the payment is capped at 60% of weekly or monthly income. So, if you make $1,000 a week, your STD payment would be $600. If you make $5,000 a month, your LTD payment would be $3,000 a month.

Life insurance is a cost effective benefit to protect your family in the case of your untimely demise. Depending on the face amount of the policy, it may be necessary to undergo a paramed exam to qualify for the coverage. But, even those with health conditions can usually purchase some level of coverage.

There are two main types of life insurance, term and universal. Term insurance is much less expensive than universal, but it only lasts a certain period of time, 10yr, 20yr, 30yr for example. At the end of the period, the policy terminates and has no residual value. Universal insurance is a life long policy. The policy builds value that can be drawn against, cashed out, or used as a life benefit. The premiums on universal are significantly higher than term, as the policy does build value and that value needs to come from somewhere. The younger you are when you buy a universal policy the less expensive it is per month, since the carrier has longer to build value in the policy.

The need for life insurance varies as you go through different life stages. When you are young without family, the level of life insurance needed is probably just enough to pay off any debt and cover funeral expenses. Once someone marries and has kids, that need to protect family financially increases. Now someone needs to thing about the mortgage, college and taking care of their significant other for their future. As some become an empty nester or a retiree, the need for life insurance begins to wane and

can be decreased. Here with the proper planning, a life insurance plan will make sure you are covered from start to finish.

Supplemental coverages are accident, cancer, critical illness, hospitalization, GAP and similar policies. Most of these policies pay if an event occurs. For example, if Kevin falls and breaks his leg and he has an accident policy, he is going to get some money. The accident policy may pay $2,000 for the broken leg, $500 for an emergency room visit, $100 for x-rays, $50 for each PT and office visit associated with the broken leg. This may cover the deductible and then some depending on the medical policy. And the accident policy will pay regardless of what the medical plan pays, and it will pay it to you. Each policy has a schedule of payments associated with events. Depending on what happens, the policies will pay cash to you.