What is supplemental life insurance?

Supplemental life insurance is coverage you can purchase from your employer in addition to the group life insurance they already offer.

It’s usually paid for out of your paycheck, like group life insurance. While group life insurance is part of your benefits package from your employer and therefore usually affordable, that’s not necessarily true of supplemental life insurance. Whether it represents good value depends on who you are.

Is supplemental life insurance right for you?

To put it simply, if you’re young and healthy, supplemental life insurance premiums may be higher than what you’d pay for the same coverage on the open market.

The reason is that when a life insurance company offers someone supplemental life insurance, they usually know less about that person than a typical insurer would. That’s because they may not ask health-related questions in the application, or fewer of them than they would if you were to apply for an individual policy. Therefore they charge higher prices for supplemental life insurance across the board to cover themselves for that risk.

If you’re young and healthy, a life insurance policy issued by an insurer that doesn’t know a lot about its customers’ health situations probably does not benefit you. Broadly speaking, the younger and healthier you are, the less you will pay for life insurance. Let’s say you’re in your 30s and in good health: you want the insurance company to know about you in detail because it will lower the price you pay. A 35-year-old man in excellent health could get a 20-year, $500,000 term life insurance policy from Haven Life for as little as $24 per month, for example, and that’s because he’s a good bet: the insurance company looks at his stats, sees he’s unlikely to die while he’s covered, and charges him an affordable amount.

Who supplemental life insurance can help

Supplemental life insurance is most useful for people who might have difficulty getting coverage on the open market, or might find it prohibitively expensive.

Let’s say you’re older, have spent 20 years smoking like a character from Mad Men and like to hang glide on your weekends. A life insurance company will consider the probability of all those factors leading to your imminent demise and price your coverage accordingly.

If that sounds like you, supplemental life insurance, which comes from a company that knows less about your particulars, may be good value.

What is Haven Life?

Watch now

What to check if you buy supplemental life insurance

One more thing about supplemental life insurance: If you decide to purchase it, be sure to check whether you can take the policy with you if you leave or lose your job.

That’s not always an option, so if you want life insurance in place for a particular amount of time (until your children are grown, perhaps; or until your mortgage is paid off), irrespective of your employment situation, it’s something to consider. On the other hand, if you buy your own term life insurance policy, it goes where you go, and keeps protecting your family even if you change employers (and continue to pay the premiums).

If you’re young and healthy, term life insurance policy is likely to be an affordable way to protect your family. To find out how affordable, use the life insurance calculator at Haven Life.

Life insurance that's actually simple.

Estimate your rate

Michael Davis is a freelance writer and editor who has covered everything from fashion and music to parenting, work, and finance. He has been a chef, restaurateur and record label owner.

Real Rate is based on your application and third party data obtained during underwriting.

Haven Term is a Term Life Insurance Policy (DTC 042017 [OK1] and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. Policy and rider form numbers and features may vary by state and may not be available in all states. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Our Agency license number in California is OK71922 and in Arkansas, 100139527.

Get the latest news

Apply now