Contributor, Benzinga
November 22, 2021

Maintaining health insurance coverage is essential to help you cover the costs of prescription drugs, emergency treatments and services and other types of medical care. While the Affordable Care Act expanded the list of essential benefits that health insurance must cover, there are still a wide range of health needs that may not be covered by your health insurance plan. That's where ancillary insurance benefits come into play.

Ancillary insurance is a type of add-on protection that you can use to affordably fill in some of these gaps that are often left by health insurance providers. Learn more about ancillary insurance now.

What is Ancillary Insurance?

Ancillary insurance is a type of secondary health insurance coverage that fills in some of the gaps in healthcare needs left by health insurance plans. Even the top health insurance companies don’t cover every cost associated with healthcare needs, which makes ancillary insurance a valuable add-on to nearly any type of coverage. 

The word “ancillary” is an adjective that means “providing necessary support to the primary activities or operation of an organization, institution, industry or system”. This refers to the support these benefits add to your health insurance. 

Types of Ancillary Insurance Benefits

There are multiple types of ancillary insurance benefits, and the benefits that you’ll have access to will vary depending on how you are employed and your current health insurance coverages. 


Your health insurance is the primary protection that you maintain against high medical care costs. However, health insurance doesn’t cover everything associated with services and care that you may need. 

Health insurance ancillary benefits help you cover the costs of items and care not covered by your health insurance, which can quickly add up in an emergency medical situation. Some examples of items that health insurance ancillary benefits may cover can include:

  • Ambulance rides
  • Bandages
  • Select medical devices not covered by health insurance
  • Hearing support and hearing aids
  • Home health services 

Health insurance also does not provide you or your family with any type of benefits or income protection in the event of an accidental death or an injury that permanently limits your ability to work. In order to mitigate this risk, many employers also offer life insurance benefits as an add-on to their ancillary health insurance offerings. 


Vision insurance is another common ancillary benefit offered through employers. Under the Affordable Care Act, health insurance providers are only required to offer vision benefits to those under the age of 18 signed onto a family plan. Though some health insurance companies opt to provide these benefits, they are not guaranteed in the same way that the essential benefits are.

A vision insurance plan can help provide you with assistance in covering the following care needs and treatments:

  • Annual and routine eye exams
  • Annual allowance that can be used toward contact lenses or prescription glasses
  • Eyeglasses lens enhancement options like anti-reflective coating or progressive lenses
  • Discounts on elective eye procedures like LASIK surgery

Like most types of insurance, the specific benefits included on your vision insurance will vary depending on your policy options and the company that administers your ancillary benefits. 


Like vision insurance, dental insurance benefits are not required to be provided to adults on an Affordable Care Act-approved long-term insurance plan. Dental insurance helps you pay for care and treatments needed to treat some of the most common dental issues like root canals, cavities and bridgework. 

Dental benefits are another common ancillary benefit that you may have access to through your employer. Some of the things that are oftentimes covered under dental insurance plans include:

  • X-rays
  • Routine teeth cleanings
  • Dental exams
  • Dental sealants
  • Fluoride treatments (for children and some teens)
  • Tooth extractions
  • Fillings
  • Root canals
  • Dental crowns
  • Denture creation and fittings
  • Dental bridges
  • Dental implants
  • Braces, retainers or aligners

Most dental insurance plans split treatments into categories, and the category of the treatment that you need will determine the percentage of the cost that your insurance will pay. For example, your insurance provider might classify a filling as a normal care need and pay for 80% of your treatment. 

However, they may classify a root canal as a major care need and pay only 50% of the treatment cost. In most cases, dental insurance plans will include 100% coverage for preventive services like X-rays and exams, but benefits vary by provider. 

Voluntary vs Employer-Contributed Ancillary Insurance

There are 2 ways that ancillary benefits may be purchased through your employer: voluntary or employer-contributed. The difference between these two systems largely comes down to who pays what percentage of your ancillary benefits’ premiums. 

Like your standard health insurance, you’ll need to pay a portion of your monthly premium to maintain your ancillary benefits. However, unlike health insurance, your employer is not required to pay 50% of your ancillary benefits’ premiums.

Let’s take a look at the differences between voluntary and employer contributed ancillary insurance benefits.

  • Voluntary: As the name suggests, voluntary ancillary insurance benefits fall mostly on the shoulders of the insured when it comes to premium payments. On voluntary benefit plans, your employer will pay between 0% and 49% of your ancillary benefit premiums.
  • Employer-contributed: On employer-contributed ancillary insurance, your employer pays a significant portion of your benefit premiums, usually between 50% to 100% of your monthly premium cost. Some employees choose to offer employer-contributed benefits in order to keep high-quality employees and to keep their business competitive when it comes to attracting new talent. Employers who offer ancillary benefits may also benefit from lower FICA contributions.

No matter which type of ancillary insurance benefits your insurance offers, the remaining portion of your premium will usually be deducted from your check each pay period. However, these premiums are oftentimes lower than independent plan options because the risk is split among many participants in the network. 

In addition, you can also pay for your percentage of your premium using pre-tax dollars, which lowers your taxable income for the year. This reduces your income tax liability. 

How to Compare Health Insurance Plans

Though ancillary benefits are important, your health insurance plan is the primary form of coverage you’ll have and maintain to protect you and your family from rising medical care costs. The following are some of the factors that you’ll want to consider when comparing plan options.

  • Premium costs: Your health insurance premium is a set monthly cost that you must pay to your insurance provider to keep your coverage current. Because your insurance can deny you coverage if you begin to miss payments, you should choose a plan with a reasonable premium for your household.
  • Deductibles: Your plan deductible is the amount of money that you must pay towards your healthcare costs before your insurance begins covering a portion of your bills. Choosing a plan with a deductible that you know you can afford is essential.
  • Coinsurance percentages: After you meet your deductible, you are only responsible for your coinsurance percentage payment. Your coinsurance is a set percentage of care costs that you’ll contribute towards covered medical services. For example, if you have an insurance plan with a 20% coinsurance rate and you receive a bill for $1,000, you would be responsible for paying $200 of this bill while your insurance covers the remaining $800. Choosing a plan with lower coinsurance helps you save more on care costs.

An important note to keep in mind—though permanent health insurance plans are required to offer coverage for the essential benefits, short-term health insurance plans do not. If you choose to sign onto a short-term plan, be sure to thoroughly review what is and is not covered before you agree to a policy.  

Get Health Insurance Quotes

Comparing health insurance quotes can help you find affordable coverage. Start your search by exploring the options below.

Add Ancillary Benefits

If you’re self-employed or your employer doesn’t offer ancillary benefits, you do have options to extend your coverages. Independent dental and vision insurance plans are available across the country and can help you fill in the gaps in your insurance affordably. 

Be sure to begin exploring your options before you need coverage, as benefits like dental insurance often come with waiting periods before you can take advantage of your benefits. 

Frequently Asked Questions


Why are ancillary benefits important?


Ancillary benefits are important because they help cover some of the costs of care and treatments that you need in order to stay healthy but are not covered by insurance. For example, though a root canal is a medically necessary procedure, health insurance is not required to cover it. Ancillary benefits like dental insurance can ensure you get all the care you need without overpaying.


What percentage of medical expenses do ancillary benefits cover?


The answer to this question will vary depending on the type of benefit you’re looking at and the treatment you’re receiving. Ancillary benefits cover only a small amount of your healthcare costs, as primary coverage is offered by your health insurance.