Accuchex Blog

How to Choose Supplemental Insurance Benefits

Posted by Leslie Ruhland on Mar 11, 2019 9:00:00 AM
Accuchex Payroll Solutions
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You don’t need to be on the Fortune 500 list to afford supplemental insurance benefits for your employees. In fact, you can often offer these benefits at no direct cost to your business. But how do you select the best benefits for your employees?

Savvy employers know that offering a robust benefits package to employees has a positive influence on employee productivity and retention and also helps to recruit top talent. Implementing new benefits is not a step to take without first doing your due diligence, however.


The modern marketplace is flush with voluntary benefit options that help to cover the gaps and expand the coverage of your core benefits offerings. Allow yourself the time to explore your available options, listen to your employees, and weigh the policies that will add the most value to your workforce. Consulting with a benefits advisor will also help you gain the insight necessary to select the best plans for your team and, when it’s time to roll out your new benefits, educate your employees on their options.

Talking to Your Teams

Some employers may hesitate to discuss potential changes in their benefits plan with employees before they have options in place. Fearful of opening a Pandora’s Box of conflicting needs, many opt to skip this step and begin researching their choices without the necessary insight that only their employees can provide.

Employee engagement is a critical component of developing and sustaining high performing and committed teams, and employee engagement surveys are still one of the best predictors of employee behavior. Employees value having a vehicle for their voices to be heard, even if changes are implemented that don’t meet their specific requests, and asking for employee input can also influence their behavior.

There is a common disconnect between employees’ financial realities and employers’ perceptions of the same. Surveying your employees to find out where they are experiencing gaps in their benefits package and what concerns they have about meeting the financial commitments of their families’ financial needs can provide invaluable insight into the best options for your unique workforce while also showing your employees the impact that their voice has on company-wide decisions.

Reviewing Available Benefits  

While a robust benefits package may include options such as Employee Assistance Programs (EAPs), wellness programs, employee discounts, tuition reimbursement, discounted childcare, and other benefits that help your employees balance their career with their financial needs, many employees see supplemental health insurance as a necessary component of their overall compensation.

These policies provide a financial safety net and cover gaps in their primary health insurance plans for a wide range of illnesses, injuries, and circumstances:

Cancer Insurance  

Cancer insurance can cover the costs of tests, treatments, procedures, co-pays, deductibles, and even childcare and non-medical expenses that employees may need help paying while undergoing treatment for cancer. Depending on the policy, a covered individual may receive a lump sum payment upon receiving a positive cancer diagnosis, reimbursements for some of the costs of covered treatments, or a combination of benefits.

Critical Illness Insurance  

Supplemental insurance policies covering critical illnesses are intended to help cover the gaps in an employee’s primary health coverage and, depending on the plan, may reimburse employees for covered expenses related to their diagnosis with a critical illness or event, or pa out a lump sum upon diagnosis to be used at the policy holder’s discretion.  

Short-Term Disability

Short-term disability insurance pays out a percentage of an employee’s regular salary when they experience a qualifying illness, accident, or disability that makes them unable to work for a short period of time.


Hospital Indemnity insurance helps patients pay for out-of-pocket expenses due to hospitalization or qualifying tests and procedures that may not be covered under their primary health plan. Stacking Hospital policies with other plans, such as short-term disability or accident insurance, is an attractive option for many employees whose benefits providers pay out regardless of any overlaps in coverage. Aflac, for example, offers Maternity coverage that combines their Short-Term Disability and Hospital Insurance plans to pay a portion of a new mother’s salary after childbirth.

Selecting a Benefits Provider

Supplemental Insurance may be 100% employer-funded, 100% employee-funded, or premiums may be paid with a combination of employee and employer dollars. Many employers choose to pay the supplemental insurance premiums for their employees and employees the option to extend coverage to their spouse or dependents through payroll deductions.

When selecting a benefits provider, you should ensure that they have the experience and range to customize a comprehensive suite of options that meet your coverage and funding needs. Consider some of the following questions when narrowing down your list of possibilities:

What initial and ongoing administrative duties will my company take on?

Ask about the resources you’ll need to dedicate to setting up and launching your new benefits as well as any ongoing administration duties that will be required to maintain the plan.

What initial or ongoing administration costs are involved?

For example, if you will be offering any benefits to your employees that qualify for pre-tax deductions under a Cafeteria 125 plan, what will you be charged to set up the plan? The creation and filing of Section 125 plan documents and ongoing maintenance to ensure compliance can cost thousands of dollars. Some benefits providers pass the plan document costs on to the employer as a one-time or annual fee, while others shoulder these and other administrative costs and only bill employers for premium payments.  

What support can you expect from the benefit provider to educate and enroll your employees?

Will it be up to you to educate and enroll your employees, or will the provider supply you with supporting literature and signage and make benefits counselors available for information and one-on-one sessions with your employees?

Are there minimums I’ll have to meet, and are plans guaranteed-issue?  
If you’re planning to offer voluntary benefits that will be employee-funded or funded with a mix of employee and employer contributions, knowing what, if any, the minimum enrollment requirements are for a plan will help you assess if you have the necessary employee interest. If plans require medical underwriting, this can also impact your ability to meet minimum enrollment requirements, whereas a guaranteed-issue policy will extend coverage without requiring a health screening.

Partner with Accuchex for Benefits Administration  

Supplemental insurance can offer a low- or no-cost option to expand your benefits package and support your ongoing employee engagement and wellness initiatives. An experienced benefits administrator who shares your commitment can make selecting plans, educating employees, and implementing your new benefits a stress-free experience.

Accuchex has been partnering with businesses in the San Francisco Bay Area and beyond since 1990 to customize comprehensive solutions in payroll processing, human resources outsourcing, benefits administration, and more. To learn more about selecting and implementing supplemental insurance options for your employees, download our Employer’s Guide to Supplemental Insurance or call Accuchex Payroll Management Services to talk to one of our specialists at 877-422-2824 today.

Topics: supplemental insurance

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