Faqs About Accidental Death And Dismemberment Insurance

Planning for the future is a part of life. And we all do it to varying degrees, whether it’s deciding what to have for dinner, or putting away money for a child’s education. But how do you plan for your own accidental death? The answer is that many people don’t. But have you stopped to think what might happen to your family in the event of your death or loss of limb? The following article offers answers to frequently asked questions about accidental death and dismemberment (AD&D) insurance. Read below and find out if this type of insurance is right for you.

What is Accidental Death and Dismemberment Insurance?

Accidental death and dismemberment insurance is a type of insurance with limited coverage. It only pays out if the death or loss of limb of the insured is caused directly by an accident. It is not a traditional life insurance policy. Beneficiaries are paid if the insured is killed in a covered accident. The insured may receive payment if the loss of limb is caused by a covered accident. An accidental death rider can be added to a regular life insurance policy. This is discussed in detail below under the "How much coverage can I get?" heading.

What is Covered by an AD&D policy?

Faqs About Accidental Death And Dismemberment Insurance
  • Accidental Death
    An AD&D policy pays out in the event of death of the insured resulting from a covered accident. Just exactly what is covered can vary according to the specific policy you get. It’s important to carefully review an insurance company’s definition of accidental death for the policy you’re interested in before buying. The death has to be classified as accidental within the terms of the policy for the benefit to be paid.
  • Dismemberment
    Dismemberment is the loss of sight in one or both eyes, the loss (above the ankle) of one or both feet, and the loss (above the wrist joint) of one or both hands. You may also be able to find an AD&D policy that covers partial and complete hearing loss. Usually only a percentage (somewhere between 25 and 50) of the full benefit is paid out for partial losses. In other words, a policy holder who loses one foot would receive between 25 and 50 percent. Full loss (such as two feet or complete sight loss) would probably result in a full pay out of benefits.

What’s Not Covered?

If you partake in activities considered to be "high-risk" (car racing, skydiving etc...) then damages resulting from those activities are not going to be covered. Other losses that aren’t going to be covered by most AD&D policies include those resulting from illnesses, drug or alcohol abuse and overdose, and surgeries.

How Much Does it Cost?

Costs for any insurance policy are dependent on numerous factors. But some of these factors, such as health or age, are less important when calculating the premium for your AD&D policy. Compared to many life insurance policies offering more comprehensive coverage, an AD&D policy will cost much less. It’s not difficult to find an AD&D policy for less than ten dollars per month. But it’s important to remember that the lower costs do reflect less coverage.

Who Can Get It?

It’s fairly easy to get approved for an AD&D insurance policy. Many companies don’t even require policy holders to have a medical exam to qualify. This makes sense, as the coverage is strictly for accidental death and not deaths that are the result of terminal illnesses or health conditions. Lower premiums make AD&D affordable to more people.

Accidental death and dismemberment insurance isn’t the answer for everyone. But it is a cheap alternative for those who don’t want or can’t afford a traditional life insurance policy and still want some financial protection for their families.