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Coverage alongside your health plan

Supplemental insurance, in plain terms.

Accident, critical illness, and hospital indemnity policies pay you a benefit when a covered event happens. They work next to a health plan, not instead of one.

Availability, benefit amounts, and eligibility vary by state and insurer.

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Read this firstSupplemental policies are not major medical insurance and generally do not count as minimum essential coverage. They are meant to sit alongside a health plan, filling gaps it leaves behind.

The three common types

What supplemental coverage actually covers.

Each type is triggered by a different kind of event. Policies differ by insurer and state, so treat these as the general shape of the product rather than a description of any one plan.

01Accident

Accident insurance

Pays a benefit when you are injured in a covered accident. Benefit amounts are usually set by a schedule tied to the injury and the treatment received, such as an emergency room visit, imaging, stitches, a fracture, or physical therapy.

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02Critical illness

Critical illness insurance

Pays a lump sum if you are diagnosed with one of the serious conditions the policy lists, which commonly include heart attack, stroke, and certain cancers. The money is paid to you and you decide how to use it.

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03Hospital indemnity

Hospital indemnity insurance

Pays a fixed amount for a covered hospital admission and often a further amount for each day you stay. It is designed to help with the costs a hospital stay creates, including the deductible on your health plan.

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How the money works

A benefit paid to you, not to the hospital.

This is the part that surprises people. Health insurance pays a share of a medical bill, so the money moves between the plan and the provider. A supplemental policy pays a defined benefit when a covered event happens, and that payment usually comes to you. Because it is not tied to the bill, it can be used for anything the event costs you: the deductible on your health plan, time away from work, travel to a specialist, or childcare while you recover.
See supplemental options in my areaPairing it with a high deductible planStart with a health plan first
  • Benefits are usually paid to you, not to the hospital or the doctor
  • Payment is triggered by a covered event, not by the size of the medical bill
  • You can use the money for anything: rent, childcare, travel, lost income, or the medical bill itself
  • Benefits are generally paid in addition to whatever your health plan pays
  • Policies define covered events precisely, so the list of conditions and injuries matters more than the headline benefit amount
  • Waiting periods, pre-existing condition limits, benefit maximums, and age limits are common and vary by policy

Before you buy

Decide on the health plan first.

Supplemental coverage is a good answer to a gap you can name. It is a poor substitute for a health plan, so the sensible order is major medical first, then the gap.

  • Know your health plan deductible and out-of-pocket maximum before shopping
  • Add up the cash you could reach quickly if a bill arrived this month
  • Compare the annual premium against the benefit the policy would actually pay
  • Check the waiting period and any pre-existing condition limitation
  • Read how covered conditions and injuries are defined, not only the benefit amount
  • Check whether your employer already offers similar coverage at group rates

Related coverage

Other ways people close a gap.

Supplemental insurance is one of several products that sit next to a health plan. If you are 65 or older, a Medicare Supplement policy is a different product that pays part of what Original Medicare leaves for you to cover. If your concern is what happens to the people who depend on your income, life insurance is the direct answer. Dental and vision plans handle care most health plans exclude for adults.
Medicare and Medicare SupplementLife insuranceDental coverageVision coverage
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Good to know

Common questions about supplemental insurance.

What is supplemental insurance?
Supplemental insurance is coverage you buy in addition to a health plan. Instead of paying a share of your medical bills the way health insurance does, it pays a set benefit when a covered event happens, such as an accidental injury, a hospital admission, or a diagnosis the policy names. The benefit is normally paid to you, and you decide what to do with it.
Does supplemental insurance replace health insurance?
No. Supplemental policies are not major medical coverage and generally do not count as minimum essential coverage under the Affordable Care Act. They do not have to cover the 10 essential health benefits, they do not have an out-of-pocket maximum that caps your medical spending, and they are not a substitute for a health plan. They are designed to sit alongside one.
How is this different from Medicare Supplement insurance?
They are different products despite the similar name. A Medicare Supplement policy, sometimes called Medigap, is standardized coverage that pays part of the deductibles and coinsurance left over by Original Medicare. Accident, critical illness, and hospital indemnity policies pay a fixed benefit for a covered event and are sold to people of many ages, with or without Medicare. If you are on Medicare, start with our Medicare pages.
Who tends to buy supplemental coverage?
People whose health plan has a high deductible, people whose household budget would be strained by a few thousand dollars of unexpected cost, people in physically active jobs or sports, and people with a family history that makes a specific diagnosis feel worth insuring against. It is optional coverage, and whether it is worth the premium depends on how much of a gap your health plan leaves and how easily you could absorb that gap yourself.
When can I enroll?
Supplemental policies are usually available year round rather than only during Open Enrollment, because they are not marketplace plans. If your employer offers them, they are typically elected during the annual benefits enrollment window. Availability, benefit amounts, and eligibility rules are set by the insurer and regulated at the state level, so what you can buy depends on where you live.
What should I read before I buy?
Read the schedule of benefits, the definitions of covered conditions and injuries, the exclusions, the waiting period before benefits start, any pre-existing condition limitation, the benefit maximums, and how and when the premium can change. On these policies the definitions do most of the work: two policies with the same headline benefit can pay very differently depending on how narrowly the covered events are written.
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Close the gap

See supplemental coverage available in your area.

Enter your ZIP code to compare accident, critical illness, and hospital indemnity options where you live.

Availability, benefit amounts, and eligibility vary by state and insurer.