Key differences
Accidental death insurance can be found as a single policy, but it's more commonly packaged together as a rider on a standard life insurance policy. Much like a standard life insurance policy, an accidental death policy pays a death benefit to your beneficiaries, but as the name suggests, only provides coverage in the event you die due to a covered accident.
The dismemberment part comes in if you were to lose a limb(s) as a result of an accident. In this case, an AD&D policy will and generally will pay out a predetermined amount as specified in your policy.* Simply put, accidental death insurance is a very specific as to what it will and will not cover. With life insurance, you'll have coverage for incidences of death as outlined in your specific contract - accidents included.**
Buying an accidental death insurance policy
If you're concerned about accidental death, work in a potentially hazardous occupation, or engage in risky hobbies or sports, an AD&D policy might be one way to insure against an unexpected loss.
Your employer may offer coverage as part of your benefits package. And, as mentioned previously, coverage may also be added onto a standard life insurance policy in the form of a rider. Therefore, if you were to if you die in a covered accident, your life insurance policy would pay extra in addition to your policy's death benefit.
Keep in mind that while an accidental death insurance policy can be very affordable, it's very limited and doesn't provide the broad protection of a standard life insurance policy. For these reasons, this type of policy is often used as a supplemental benefit and not as stand-alone life insurance coverage.
*Some AD&D policies include coverage for a complete or partial loss of vision, hearing, and speech as a result of an accident.
**Life insurance policies typically pay for most causes of death, exceptions will be specified in your contract. Policies will vary.
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