What is AD&D Insurance and how is it different from life insurance?
- Basic accidental death and dismemberment (AD&D) insurance is a policy that pays full benefits to beneficiaries if the cause of death of the policyholder is in a covered accident. In the event of a non-fatal accident that results in losing your eyesight, speech, hearing, or a limb, AD&D insurance will pay you or your beneficiaries a specified amount.
- Because AD&D insurance is a limited form of life insurance it is generally less expensive than term-life or whole-life insurance policies. A basic AD&D insurance policy can provide stand-alone protection for you and your family or it can be considered supplemental insurance if it is added to a term-life or whole-life insurance plan.
- Accidental death insurance is a good idea if you are unable to qualify for life insurance, due to medical reasons. At least part of your death risk would be covered.
- Life insurance is meant to provide a lump sum to your beneficiaries in the event of your death from natural causes and most diseases. There are some circumstances under which policy benefits are not payable, and some things that they don't cover, so make sure you read the fine print of any insurance policy to determine if AD&D insurance is right for you.