What Are Ancillary Benefits? Types of Ancillary Plans & Why to Offer Them
Ancillary benefits are a vital form of coverage employers can offer their employees today. There are several different plan types that can supplement existing insurance policies so that your employees have all the coverage they need in times of crisis.
Existing ancillary plan types can include such benefits as disability insurance, accident insurance, life insurance, vision and dental insurance, pet insurance and much, much more. And as you can imagine, each of these ancillary benefits comes with amazing advantages.
With progressive technology, game changing financial solutions for employees, and high-level customer service, Beckham Insurance navigates the complicated world of employee benefits for you. Learn More
What Are Ancillary Benefits?
Ancillary benefits are supplementary health insurance benefits that help your employees cover any health or medical-related expenses. Typically, these expenses are accrued in addition to an employee’s medical bills. They can cover anything from ambulance rides to necessary pharmaceuticals to any bandages or medical supplies that are needed. Ancillary benefits can be covered one of two ways:
Voluntary Plans
With these plans, the employer will pay 0-49% of the premiums, so typically, employees end up paying 100% of their coverage costs.
Employer-Contributory Plans
With these plans, the employer will pay 50-100% of the premiums and deduct the cost from their employees’ paychecks in the same way they do for health insurance premiums or retirement plans..
Types of Ancillary Benefits
Ancillary benefits cover a broad range of expenses, so the types of ancillary insurance you can offer your employees is virtually limitless. Let’s take a look at a few of the most common ancillary benefit types.
Disability Insurance
Disability insurance, whether you offer long or short term plans, helps employees cover part of the salary they lose if they are unable to work because of a disability. It cannot cover the full amount of salary lost, but it typically will provide employees with up to 60% of their earnings.
Critical Illness Insurance
Critical illness insurance covers any illnesses or medical emergencies that result in higher-than-normal medical bills. Typically, these emergencies include heart attacks, strokes, or cancer. Normal health insurance policies can cover part of the expenses associated with these illnesses, but they may not be able to sufficiently cover the entire sum.
Accident Insurance
Like critical illness insurance, accident insurance covers extra costs that a healthcare insurance plan may not be able to fully cover. Accidental injuries covered may include broken limbs, burns, lacerations, lost limbs, or even accidental deaths.
Vision and Dental Insurance
Vision and dental insurance policies are two of the most common ancillary benefits offerings today. They provide employees with preventative care coverage, x-rays, and other routine expenses as well as providing a budget for covering glasses, braces, or other necessary long-term supplements. Additionally, these insurance types can help offset costs associated with dental surgeries, eye surgeries, or other major medical expenses associated with vision and dental care.
Pet Insurance
People are the only creatures that many need medical coverage–in fact, pet insurance is becoming more and more popular as vet bills rise. Pet insurance coverage can help your employees offset expensive medical bills that their pets may accrue. They reimburse owners for accidents and illnesses and may even extend to covering veterinary check-ups or other wellness treatments.
Wellness Benefits
Wellness benefits are a great option for companies to offer employees because they can reduce overall insurance expenses as the body of employees becomes more healthy. Wellness programs can include such things as smoking cessation programs, weight loss incentives, and stress reduction programs.
Benefits of Offering Ancillary Coverage
As you can already tell, there are many benefits to offering ancillary coverage options to your employees. They can incentivize employees to stay with your company, bring in the best job candidates, provide tax advantages, decrease premiums, and much more. Let’s take a closer look at some of these benefits:
Incentivizes Employees
By offering ancillary benefits, you incentivize your employees to stay with your company in the long run–especially if your peer companies don’t offer ancillary benefits to the same extent your company does.
More Competitive Recruitment
When you offer benefits that few other companies do, you automatically make your company seem more appealing to the masses of potential employees on the market. And when more potential employees are interested in–and applying for–positions in your company, your candidate pool becomes much more competitive. Ultimately, this allows you to choose the best employees instead of settling for one among the few who apply.
Provides Preventative Care Options
While many insurance types provide care in case of emergencies, disabilities, and accidents, not many health programs offer much in the way of preventative care. Ancillary benefits pick up where other insurance types leave off. They supply employees with the care that keeps certain bigger health issues from developing in the first place, saving both employee and employer a lot of money in the long run.
Employee Benefits Made Easy
We hope you now know more about the different types of ancillary benefits and why to offer them. At Beckham Insurance Group, our knowledgeable and experienced employee benefits representatives are here to help make your benefits administration as easy and stress-free as possible. Contact us today to learn more about how we can help you build a competitive and comprehensive benefits program.
