Accidental death and dismemberment insurance (AD&D) is offered through a policy that pays additional benefits in case of a non work related accident. In the event of accidental death this insurance will pay a little more in addition to the insurance that is already held. Death due to natural causes such as from cancer, heart disease and suicide are not covered by AD&D.

• Accidental death and dismemberment insurance usually pays when the policyholder suffers from the loss of limbs, fingers, sight, or permanent paralysis. However the point to be noted here is that here are certain exceptions to it. Accidents caused because of undertaking dangerous sports such as racing, mountaineering, and paragliding are not covered. Other exceptions include war and terrorism.
• There are four types of Accidental death and dismemberment insurance offered in the United States. These include group life supplement, voluntary, travel accident, and coverage for dependents. The amount that is paid out and the types of injuries differ according to the insurer and the package offered and these are explicitly mentioned in the insurance policy.
• In group life supplement the AD&D benefit is a part of the insurance policy and the amount that is to be paid out is the same as that of group life benefit. In voluntary policies the AD&D benefit is given to the members of the group as a separate benefit that is a payroll deduction. In travel accident policies (business related) the premiums are paid entirely by the employer and provide additional coverage to workers. Some insurance policies may also offer cover for dependents.
• These policies can also be offered in the form of riders and can also carry a double indemnity clause. This clause simply means that the beneficiaries would get a double reimbursement in case of the policyholder’s death due to an accident. This simply means that if you have opted for the rider and the double indemnity clause in a policy worth $100,000 then your dependents would get $200,000 in case you are killed in an accident.
• These policies usually work on a one member basis which means that if you lose one limb then only half benefit is paid. However Accidental death and dismemberment insurance policies are very limited in nature and should be purchased as a rider and not as a stand-alone policy. Moreover the death of the person should be the direct result of an accident in order for the policy to be effective.
• The need for such policies completely depends on your financial condition and if you have any dependents. These policies are very low-priced since only approximately 5% of deaths in the United States are due to accidents. The premium for such policies can be as low as $60 per month. It is advisable to choose a rider of AD&D instead of purchasing a separate Accidental death and dismemberment insurance policy. Moreover these policies are usually offered to people who are above the age of 45.

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