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Accidental Death Insurance Review

accidental death insuranceAccidental Death Insurance: What it is not

A popular question we often get asked is what is AD&D insurance? The majority of agents that sell accidental death prefer to refer to the insurance as “AD&D insurance” or even more tricky is when they call it accidental life insurance. We believe the main reason agents refer to an accidental death policy this way is because they do not want to say the word “accident” or “death.” But accident is the first word of AD&D insurance and it should not be ignored, as we will explain below.

Jump to: Top 5 Reasons to Buy Accidental Death Insurance

Accidental death and dismemberment insurance policies, also known as AD&D policies, are a great way to supplement traditional life insurance policies. However, it is TermLife2Go’s official opinion that they should never be used to replace more comprehensive policies such as traditional term life or whole life insurance.

Accidental death insurance is designed to help protect you and your family if you are killed in an accident, or for policies, suffer dismemberment. The policy does not cover death by natural causes.  Did you get that? An AD&D insurance policy will not pay out if the insured dies by natural causes. So why buy such a policy if it won’t cover natural causes, such as old age?

An accidental death insurance policy will not pay out if the insured dies by natural causes.

Two types of accidental death insurance

There are two types of accidental death policies. One is a straight accidental death policy and the other is an accidental death and dismemberment policy.

Accidental Death Insurance with return of premium

Straight accidental death insurance only covers accidental death. There is no additional benefit for dismemberment. Accidental death insurance is typically cheaper than an AD&D policy. However, for around the same price as an AD&D policy, you can purchase an accidental death policy with a return of premium rider. The ROP rider on the accidental death insurance pays back all your premiums if you do not die of an accidental death. That way, your beneficiary will at least receive some benefit upon your death.

Accidental Death and Dismemberment

Accidental death and dismemberment insurance offers an additional living benefit apart from the death benefit. If you are blinded, dismembered, or paralyzed, the AD&D insurance will still pay out even if you do not die. However, if your blindness, paralysis, or dismemberment is due to a sickness (diabetics beware!)  the policy will not pay you or your beneficiary anything.

Which accidental death insurance company is best?

We need to point out again that there are no accidental life insurance companies. There is no such thing as accidental life insurance.

Now, we tend to lean towards the accidental death insurance with a return of premium simply because your beneficiary will get something when you die by natural causes. With AD&D insurance there is no guarantee that your loved one will receive anything.

Exclusions and Limitations

Both accidental death insurance policies have quite a few exclusions and limitations. You basically cannot die of an accident while on drugs, do anything illegal, or engage in various hazard or reckless activities (think skydiving, rock climbing, private piloting, etc).  We know first hand that these policies do pay out in the right circumstances because we have had clients die due to an accident.  But we have also heard plenty of sad stories from family members of people with accidental death insurance that received nothing. Buyer beware.

Therefore, in light of all that we have covered above…

Top 5 reasons to buy Accidental Death Insurance 

#1.  Pre-existing conditions prevent you from qualifying for traditional coverage.

However, be sure that you have exhausted all options first. It may be that you have been told that you don’t qualify for coverage simply because you don’t qualify with that particular company or carrier.  Not all insurance carriers or agencies view pre-existing conditions and high risk life insurance the same.  For this reason, it is essential that you, the consumer, work with an agency that can pick an choose among dozens of different insurance companies so that you have the most options to choose from.

#2.  Traditional coverage is too expensive.

This is a better reason to consider purchasing an Accidental Death Insurance policy. But again, be sure that you have exhausted all options first.

Understand why the traditional coverage costs so much.

Traditional insurance premium rates can vary significantly from one carrier to the next based on what you qualify for.  Be sure to work with an agency that can pick and choose among dozens of different life insurance companies so that you can be sure you are looking at the best rates available to you.

Also, there may be circumstances where your rates could decrease significantly in the future, in which case Accidental Death Insurance could function as a “bridge policy,” providing some coverage until that time where a traditional policy would be available or more affordable.

#3.  Looking to supplement existing coverage.

Looking to supplement existing coverage is a good reason to look at purchasing Accidental Death Insurance with a return of premium rider.  Also, many people include an AD&D insurance rider onto their life insurance policy for double indemnity in case their cause of death is an accident or they become dismembered.

#4.  You really could die from an accident!

Looking beyond the truth that we all could, in fact, die from an accident, you may be at an increased risk due to your:

  • lifestyle (motorcycle riders, scuba divers, recreational boating),
  • career choices (trucker, construction worker, electrician, fishing industry, oil worker, underwater welder), and/or
  • environment.

But just because you have a greater risk of dying from an accident doesn’t necessarily make accidental death insurance a better option for you. Therefore, be sure that your agent goes over all your options available before you make any quick decisions.

#5.  You just can’t be bothered going through the whole process of getting traditional coverage!

This is the worst reason to consider buying Accidental Death Insurance. While it is true that qualifying for a traditional life insurance policy in the past may have been difficult, in today’s competitive marketplace many insurance carriers have come to realize that if they are going to be able to earn your business, they need to make things less difficult.

For this reason, TermLIfe2Go works with many different carriers that will be able to provide you with full term life coverage that will protect you and your family from both natural as well as accidental causes of death, without having to take a medical exam! Therefore, you can’t use the tired excuse that you are too busy to take an exam because there are plenty of cheap no medical life insurance companies available.

Now you can answer the question, “what is ad&d insurance.” But the real question is, is accidental death insurance the right policy for you? There is one sure fire way to find out—give us a call and speak to a licensed insurance professional who has your best interest in mind, not the life insurance companies!

So, what are you waiting for?  Give us a call today or visit our Life Insurance Quotes page and see what we can do for you!

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