Colonial Life & Accident Insurance Company has introduced an insurance policy that can help health savings account holders fill in coverage gaps.[@@]

Colonial Life, Columbia, S.C., which does business as Colonial Supplemental Insurance, says its new H.I. Secure hospital confinement indemnity policy is an individual policy that pays a benefit for each hospital admission, a flat daily rate for confinement in the hospital and a higher daily rate for confinement in a hospital intensive care unit.

Colonial Life plans to sell the policy through the worksite and now is offering it in 34 states.

Federal law requires holders of HSAs to buy high-deductible health insurance. To encourage HSA holders to avoid unnecessary use of medical services, the HSA law forbids HSA holders from using insurance to cover their deductibles. But the HSA law lets HSA holders own certain kinds of insurance policies that pay indemnity benefits, and the H.I. Secure policy qualifies as a permitted product, Colonial Life says.

Colonial Life is a unit of UnumProvident Corp., Chattanooga, Tenn.