Supplemental Term Life Insurance

Updated: 09 June 2023

What Does Supplemental Term Life Insurance Mean?

Supplemental term life insurance is a policy that fills the coverage gaps in a primary term life insurance policy. Some people obtain term life insurance courtesy of their employers. In many cases, these policies offer coverage in multiples of the employee’s annual salary. However, it is quite likely that the coverage is insufficient, especially for people with families or several financial liabilities. In this scenario, supplemental term life policies provide an enhanced level of coverage.

Insuranceopedia Explains Supplemental Term Life Insurance

Many employers provide their employees group life insurance policies. The size of the group largely influences the coverage and benefits offered under these policies. In fact, many smaller companies typically offer coverage as low as $5,000. This could be due to the small group size and budgetary constraints.

Given the limited benefits of some policies, some employees opt for supplemental term life insurance policies. They allow the insured to augment their existing coverage up to a specific amount, usually in increments of $10,000 or $25,000. Some insurance companies do not require evidence of insurability.

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