Having a comprehensive life insurance policy helps protect your loved ones from financial hardship, but what if the coverage isn't enough? Supplemental options can provide much-needed benefits on top of a traditional plan. So, what is supplemental life insurance, and how should you decide if you need another policy in addition to your primary one?

Here's what you need to know about buying a supplemental life insurance policy so you can make the best choice for you and your family's needs.

What Is Supplemental Life Insurance?

A supplemental life insurance policy provides extra coverage in addition to the coverage you receive through a traditional life insurance policy. In some cases, supplemental policies are offered through group insurance plans such as those sponsored by an employer, although you may also purchase a supplemental policy through a private insurer.

Purchasing a supplemental policy allows you to increase your overall benefit beyond your traditional life insurance policy. The cost for supplemental life insurance depends on a number of factors, including the specific type of supplemental insurance you choose and the size of the benefit.

Some types of supplemental insurance may not require information about your health background. However, if you wish to buy a supplemental policy with a large benefit, the insurer will likely require a health history and possibly even a medical exam.

Types of Supplemental Life Insurance

While some supplemental life insurance policies simply give you the option of increasing the size of your death benefit, there are also a number of more specific types of supplemental policies that you may encounter. These include:

Accidental Death and Dismemberment (AD&D) Insurance

This is one of the most common types of supplemental policies. AD&D pays a benefit to the insured individual if they die or are seriously injured in an accident. Death or debilitating injury that are the result of illness are not covered by this kind of supplemental policy.

Spousal/Domestic Partner Life Insurance

This kind of policy covers the life of the spouse or partner of the individual insured by the traditional life insurance policy. Some group insurance plans will offer a benefit that's equal to a percentage of the amount of coverage the employee has chosen for their own policy, while others will make a specific dollar amount the benefit cap on any spousal supplemental policies.

Dependent Child Life Insurance

Like spousal supplemental policies, this kind of life insurance provides coverage for the life of a dependent child of the insured individual. The benefit amount is generally set lower than that of both the primary insured individual and the spousal benefit.

Burial Insurance

This type of policy is designed to cover the cost of burial for the policyholder. The benefit for burial insurance is generally low, ranging from $5,000 to $10,000.

How to Decide If You Need Supplemental Life Insurance

Everyone's needs are different, but in general, there are three main reasons why supplemental life insurance might be right for you:

• You have trouble qualifying for individual life insurance that's equal to the supplemental insurance available to you.
• Your supplemental life insurance policy is subsidized by your employer or another group you're affiliated with, lowering the cost for you.
• You need coverage for your spouse or dependent children that you can't get elsewhere.

Before purchasing supplemental life insurance, it's best to check if there are any individual life insurance options that could provide the full coverage you need. Adding a supplemental policy to your existing life insurance can be more expensive than simply switching to another individual life insurance plan with the same level of benefits.

Supplement Your Peace of Mind

For most, a traditional life insurance policy offers sufficient peace of mind. Others need supplemental life insurance for some extra reassurance. This includes people who want coverage for a spouse or dependent children and those who'd benefit from cost savings under a group plan.

In order to figure out if a supplemental life insurance policy can give you the coverage and benefits you need, it's best to shop around and compare supplemental policies with individual policies. Discussing your options with a professional advisor can also help you make an informed decision that will work for you and your family.