You have no doubt given thought to what would happen to your loved ones in the event of your untimely demise due to some sort of accident. Financial hardships and other losses can make this time of personal grief especially trying. Life insurance is meant to give you peace of mind—assuring that your family will be taken care of should something happen to you. However, you may wish to obtain more coverage than a standard life insurance policy can provide.
For these special cases, an accidental death and dismemberment (AD&D) insurance policy is an option to consider when choosing the right type of life insurance.
AD&D Insurance Policies
An AD&D policy will provide a cash benefit to your beneficiaries if you die as the result of a covered accident or suffer a partial or complete dismemberment due to a covered accident.
AD&D insurance will pay for accident claims in addition to any primary insurance coverage you have, such as disability insurance, or your employer’s worker's compensation insurance that would pay for a dismemberment caused by a work-related accident.
Typically, a policy will provide $20,000 to $500,000 in coverage and may be written on an individual policy or through an employers’ benefits package.
Some policies may have options to cover additional "riders." A rider is an extra benefit added to the policy.
In a death claim for a covered accident, the full benefit amount is paid. For a limb dismemberment or loss of eyesight, these payments are made as “scheduled payments,” or a certain percentage of the principal policy coverage amount.
There are certain exclusions that apply to most AD&D policies, such as an injury caused from a suicide attempt, death from surgery, drug overdose, or harming yourself intentionally in some way. Other exclusions may also apply and vary by insurance company.
10 Insurance Companies Offering AD&D Policies
Prudential Insurance offers an employer benefit AD&D policy with an option to add a spouse and children. Depending on your employer, the premium for yourself may be paid with the option to add your dependents for an additional premium you would pay.
The AD&D policy through Prudential is available as stand-alone coverage or as a supplement added to a standard term life insurance policy. You can add a rider on your policy for the following options:
- Additional payment if dying in a car while properly using a seat belt in a vehicle equipped with airbags
- Losses due to coma, exposure, disappearance, felonious assault, or employee/spouse/domestic partner joint death
- Spouse or child tuition reimbursement
- Surviving spouse benefits
2. Mutual of Omaha
Mutual of Omaha’s AD&D coverage is provided as an added option to an employer term life insurance plan.
There are three different optional riders:
- Family Suite: Provides a spouse education benefit up to $3,000; a child education benefit up to $5,000; a childcare benefit of up to $5,000 for covered child care expenses; and a continuation of coverage option so that coverage remains in effect for the spouse and dependent children for up to 12 months after death.
- Travel Suite: This option adds a sea tbelt benefit which pays an additional 10% up to a maximum of $25,000; an airbag benefit up to $25,000; a double benefit if the accident occurs in public transportation, and $5,000 in repatriation fees for transportation of remains.
- Catastrophe Suite: Pays a paralysis benefit if a covered injury results in paraplegia, hemiplegia, quadriplegia, triplegia, or uniplegia; an additional 10% up to $10,000 for vehicle or home modification; 5% additional up to $5,000 per month for coma up to 20 months; hospital confinement income and up to a $25,000 benefit payment for felonious assault injuries.
3. AIG Direct
AIG Direct offers AD&D plans that are designed to fill the gaps your medical plan does not cover in the event of a covered accident or a critical illness. This includes situations in which you lose a limb, suffer blindness, are paralyzed, or are killed.
With accidental death insurance through AIG Direct, you can select from between $50,000 and $500,000 in coverage.
Aflac offers an accident insurance policy through employers providing cash benefits for accident care and recovery costs including emergency treatment, medical transportation costs, lodging, and more.
Two accidental death policies are available through Transamerica:
- Plan A: Provides a benefit up to $250,000 for a covered accidental death which doubles to $500,000 for common carrier (public transportation) accidents.
- Plan B: Has a benefit amount of $25,000 for a covered accidental death which increases to $250,000 for common carrier accidents.
Spouses and children can be added to either plan for an additional premium. The rider adds an additional payout of $125,000 for spouses and $5,000 for children when added to Plan A. The Plan B rider pays out $75,000 for spouses and $5,000 for children.
6. Fidelity Life
The Accidental Death Benefit insurance policy from Fidelity Life provides coverage of $50,000 to $300,000. The policy is available to individuals ages 20 through 59.
A full death benefit is paid up until age 70 and is then reduced to 50% of the face value of the policy until it expires at age 80. Riders are available to cover children and spouses.
AD&D coverage from Farmers Insurance provides coverage from $37,500 to $200,000 to pay for accident-related expenses and lost wages. The cost of $100,000 of coverage starts at only $4.50 per month. There is no waiting period for coverage to begin.
Applying for coverage can be fast and easy for applicants ages 18 to 69.
8. The Hartford
The AD&D policy from The Hartford provides 24-hour protection for a covered injury, paralysis, or death, and will pay for losses occurring within 365 days of the covered accident. Under this plan, coverage is included for the following:
- Loss of life
- Loss of speech
- Loss of hearing
- Loss of hands, feet, or sight
- Loss of thumb or index finger of either hand
- Loss of movement
The plan is provided through employers to employees on an employer-paid, voluntary, or stand-alone basis.
MetLife AD&D insurance pays benefits on claims resulting from a loss of life, speech, hearing or sight, paralysis, and other losses. It is provided as an employer-paid, employee-paid option, or a combination of both.
Standard and optional benefits may include coverage for:
- Seat belt
- Common carrier
- Child care center
- Child care education
- Spouse education
- COBRA continuation
- Job-related injury
- Parental care
- Rehabilitative physical therapy
- Repatriation of remains
- Therapeutic counseling
- Workplace felonious assault
10. Sun Life Financial
Sun Life Financial offers AD&D insurance to match the value of your life insurance policy—for example, twice your salary—or you may choose a different amount. You have the option to choose an amount based on your salary, or you can choose a set dollar amount.
The policy provides coverage for losses due to:
- Accidental injury
- Quadriplegia or paraplegia
- Loss of sight in one eye
- Loss of speech or hearing
- Loss of limb (arm or leg), thumb, and index finger
In the event a covered accident results in your death, your beneficiary will receive 100% of your coverage amount.
Alternatives and Considerations
For most people, AD&D will not be their primary coverage, but rather a supplemental policy to provide additional coverage not offered by a standard life insurance policy.
Keep in mind that an AD&D policy pays out only if your death is caused by a covered accident. You are more likely to die from some other cause that is not covered, including cancer, heart attack, or some other illness.
Also, some exclusions apply to policies such as accidents resulting from dangerous activities, including car or motorcycle racing, skydiving, and other high-risk activities. Be sure to find out what is excluded before purchasing an AD&D policy.
Some employers offer this coverage to their employees for free. If you can get extra coverage for free, it likely makes sense to do so. Many life insurance companies allow you to add an AD&D rider to your existing life insurance policy for an additional premium. This may be a cheaper option than purchasing a stand-alone AD&D policy.
If you think additional, AD&D coverage may be right for you, shop around and compare coverage options and pricing to get the best value on a policy.