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How Does Dual Insurance Coverage Work?

If you’re offering employer-sponsored health benefits in your workforce, an employee of yours may qualify for what is called “dual insurance coverage” if her/his spouse is also receiving benefits from their respective employer (note: a child may also have dual insurance coverage if covered by both parents’ plans). 

In such cases, the plan with the oldest policy holder is designated the “primary plan”, while the other is designated the “secondary” plan. The insurance carrier makes this designation, and it is not selected by the employee making the claim. 

Benefits of Dual Insurance 

Essentially, dual insurance coverage allows employees to access both insurance plans – the primary and secondary – to cover their medical claim costs. The primary insurer pays out the claim first, followed by the secondary insurer (if applicable and necessary).

Since the combined coverage can reach or exceed 100 percent, dual coverage often means that employees don’t have to pay any out-of-pocket (co-pay) expenses. Or if they do, it’s less than what they would be obligated to pay without dual insurance coverage. 

More Medical Coverage 

Furthermore, it’s not uncommon for insurance companies to provide markedly different benefits for the same procedure. For example, insurance company A may pay 30 percent, while insurance company B may pay 80 percent. An employee with dual insurance coverage will be fully covered. However, without dual insurance, they would only receive 30 percent of the cost per their claim, and have to co-pay 70 percent. For many employees this would be quite burdensome, if not cost prohibitive. 

Providing Coverage Between Jobs 

Another aspect of dual insurance coverage – and one that is often more valuable than the primary/secondary insurer scenario described above – is that employees who are unemployed can file a claim through their spouse’s insurance coverage. Of course, their spouse must be employed at the time and be covered under their respective insurance plan. If both spouses are unemployed – even if it is temporary while they are each transitioning to new jobs – then dual insurance coverage does not apply, and insurance will have to be purchased privately.

Promoting Dual Insurance Converge in Your Workplace

While dual insurance coverage is not a new concept, some employees are not readily familiar with it – especially with respect to (as noted above) how it can provide coverage to their spouse if he or she is unemployed or switching jobs.

As such, it is a good idea to remind your employees about the advantages of dual insurance coverage. It will help put their minds at ease, and it will give you another clear way to demonstrate that you’re an employee-focused organization.

Have More HR Questions?

If you have additional HR questions, contact the experts at Connected Benefits today. Our in-house HR experts regularly support our clients with advice, guidance and insight.

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Topics: Employee Benefits