What you should know if your loved one had AD&D coverage

One type of insurance coverage often offered in employer benefit packages that is sometimes confusing is accidental death and dismemberment (AD&D) insurance. People tend to focus on the dismemberment part. Actually, these policies typically cover other traumatic injuries like paralysis, blindness or hearing loss that prevent the use of part of the body.

However, AD&D is actually one type – albeit a limited type – of life insurance. Often, it’s included as a rider to another type of insurance policy.

What is considered an accidental death?

If you’re dealing now with the death of a loved one who had AD&D insurance through their employer, but not a life insurance policy, will it pay out? It depends on the cause of death. That’s where the “accidental death” part comes in.

Typically, AD&D insurance covers accidental deaths from:

• Vehicles crashes
• Fire
• Guns
• Falls
• Workplace accidents
• Homicide
• Exposure (to heat, cold and other elements)

On that last one, note that it may not cover some high-risk activities.

AD&D insurance won’t cover deaths from cancer, heart disease and other illnesses or natural causes. It may cover fatal heart attacks, but only if it can be proven that the heart attack was caused by an accident. It does not cover death by suicide.

So why get AD&D? As we noted, it can cover not just death, but catastrophic injuries that can limit vital functions and prevent them from working – at least for a time.

What is double indemnity?

If someone has an AD&D rider on a life insurance policy and they died from a covered accident, their beneficiaries generally get “double indemnity” that’s usually twice the amount of the life insurance policy, up to a designated amount (cap).

If you’re dealing with the loss of a loved one, it can be challenging to sort through all of their insurance policies and try to decipher the fine print to determine what you’re entitled to – particularly if they never discussed their employer-provided insurance with you beyond the family health insurance coverage. If your loved one’s insurance isn’t paying out or not paying the amount you believe you’re entitled to, it may be wise to seek legal guidance.