By Byron Udell
Accidental Death & Dismemberment (AD&D) life insurance is a type of life insurance policy that pays beneficiaries a death benefit if the insured died because of an accident that was specifically covered under the policy. Accidental Death & Dismemberment life insurance is also sometimes called double indemnity life insurance and is available as a rider on a regular life insurance policy (term or permanent) which will pay out an additional amount to the beneficiaries should death occur by the accidents covered.
Dealing with the unexpected
AD&D is usually bought by those who want to provide an extra cushion for their families especially since accidental deaths are an unexpected, untimely event. Death caused due to accidents can be emotionally crippling in how quickly and suddenly they can rip apart families. What's worse is dealing with potential medical bills that can run into the thousands, especially if the injured person succumbed to his injuries. The extra payout from AD&D life insurance can help cover such costs, and even pay for unforeseen expenses and damages like replacing a car, settling lawsuits or paying for extra costs that any other insurance did not cover. An AD&D policy sold on AccuQuote can cover up to $500,000 in coverage.
The best part about Accidental Death & Dismemberment life insurance is that anyone aged 18 to 80 years is guaranteed to be accepted. Unlike other policies, you do not have to answer questions about your medical history or take a health examination. As long as you're paying your premiums on time, you can keep this coverage for as long as you like, which means, it doesn't run out like term life insurance. If you get a double indemnity rider for accidental death and dismemberment coverage on another life insurance policy, you may be asked to fill out questionnaires and take a medical examination, depending on the type of policy, amount of coverage and the insurer.
The National Safety Council is a quasi governmental agency that was set up to record data of accidental deaths; whether they were work related or otherwise. Their 2005-2006 fact sheet on injury estimates that one American dies every 5 minutes as the result of an accident. Accidents are the fifth leading cause of death in the United States, and claim the lives of 13 Americans every hour, every single day of the year. With regard to statistics on the road, one death occurs every 11 minutes as a result of motor vehicle accidents.
Don't be alarmed by these facts, be informed by them. While the probability of this happening to any one of us is distributed over a large population and varies state by state (the National Safety Council does not have data for all states yet), there are many who don't understand how close to home the reality of an accident can be until it hits a close friend, loved one or family member.
The most common exclusions in Accidental Death & Dismemberment life insurance policies are death by illness, suicide, war, exposure to noncommercial amounts of radiation (such as reactor leaks), and natural causes. If the insured were to die of these causes, the policy would not pay out. Some insurers have a longer list of exclusions that go on to include death under the influence of non-prescribed drugs or alcohol, overdosing from toxic substances or poison, and injury during a professional sporting event. You can ask your insurer to allow your policy to include some of these under the policy's coverage if necessary, but it will most likely result in you paying higher premiums. Before an AD&D policy pays out, the life insurance company will commission extensive research into making sure that the accident was a legitimate one and its circumstances were covered under the policy's contract language. This can include a long claim process, an autopsy on the client and official investigations taking the help of police reports or other agencies involved. Don't let this dissuade you; it is only the life insurance company doing its due diligence. As long as the accident was covered under the policy, you will have no reason to fear or mistrust the company paying what is rightfully due.
Some benefits offered by policies sold on AccuQuote include:
- Travel Accident Benefit, which pays an additional 100% if death was caused by an accident when riding as a fare-paying passenger on public transport systems, trains or airplanes.
- Auto Safety Benefit, which pays an additional 10% of the death benefit if the death occurred in a car accident.
Talk to your insurer about how benefits work in the case of dismemberment. Different exclusions will come into effect that you should be informed about. Make sure to have some life insurance in place at the very least, even if you don't get an Accidental Death & Dismemberment policy. While an AD&D policy grants sustained protection, it is limiting in its protection and will not cover death due to an illness or any other cause that is not accident related. Insurance premiums also rise intermittently and some kinds of AD&D policies need to be renewed periodically.