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| Supplemental or Voluntary Life Insurance |
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| A Supplemental Life Insurance policy is a separate plan offered as an optional coverage. The number of options available will depend on the underwriting requirements of the Insurance Company and the employer’s wishes. This coverage is intended to allow employees who need more coverage than is provided by the Basic Life Insurance policy the ability to purchase additional insurance through their employer.
The most common benefit plans are either:
- Incremental amounts of $10,000 to a maximum based on an employee’s earnings (for example, 3 times salary), or
- Increments of an employee’s salary (for example, 1, 2 or 3 times salary).
With supplemental or voluntary life insurance there are typically some additional policy provisions. For example, an employee may have to have a medical examination to receive additional life insurance over a certain threshold. Late enrollees will probably also have to have a medical exam before being approved for coverage.
A Group Universal Life policy is a version of a supplemental or voluntary life product. It has a cash value feature which allows the employee to combine their life insurance policy with an investment fund. This policy allows the employee to skip premium payments as long as the cash value is sufficient to cover the premium payment.
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