What is Accidental Death and Dismemberment (AD&D) Insurance?

Accidents are a leading cause of death and disability, especially in young people. In fact, 25% of traffic fatalities in America involve a young person under 25 according to the Census Bureau. Worldwide, nearly 400,000 people under the age of 25 die every year in traffic accidents according to the World Health Organization. There are many more non-fatal but still disabling accidents and non-traffic related accidents.

Car insurance is certainly an important safeguard in the case of traffic accidents, but its coverage is limited. To ensure that you and your family are covered for all types of accidents, let's look at a different type of insurance that might help.

AD&D is an important insurance to have

Few people who have Accidental Death and Dismemberment Insurance (AD&D) actually understand the importance of this plan. It often appears as a tag-a-long to life insurance. However, it can prove useful to many people who may have never considered it before.

AD&D pays a benefit if the insured person dies due to an accident (as opposed to a disease like heart disease). If the plan is paired with Life Insurance, the benefit it pays is in addition to the Life Insurance benefit in the case of an accidental death. The exact amount and any exceptions are listed in your Certificate of Insurance or Certificate Booklet.

What is the difference between life insurance and AD&D?

But what if you have an accident, and the doctors manage to save your life at the cost of a limb or other essential part. Life insurance only pays your beneficiary if you die. AD&D pays the insured for certain disabling accidents. Losing the use of your eyes because of an accident, for example, would change your life drastically. The insurance still pays a lump sum depending on your loss. Read your Certificate of Insurance carefully when you purchase the insurance to make sure the coverage is enough for what you might need. It will do you no good to discover once you have a disabling accident that your insurance wasn't sufficient.

Travel Warning and AD&D Coverage

If you plan international travel to a country for which the State Department has listed a Travel Warning, make sure your insurance will cover that. Many AD&D plans won't cover accidents in countries with Travel Warnings even if the accident is not related to war.

A good broker can find the right plan for you.