The accidental death and dismemberment insurance (AD&D) as the name suggests, covers the accidental death and dismemberment. It is the additional rider that is attached to the life insurance policy and the health insurance policy that pays you or your beneficiary in case of the death by accident and dismemberment which includes loss of any of your body parts or the capability to use it. The body parts included in the coverage are limbs, speech, eyesight, and hearing.
AD&D rider is also known as the double indemnity rider, which comes with the strict terms and conditions and limited coverage. Also, to add this coverage you need to pay double the amount that is otherwise payable.
There is a schedule of payment that specifies the percentage of the amount that is payable in different circumstances. Also, it specifies the circumstances that would not be covered. Generally, death by suicide, by an overdose of nonprescription drugs, the death of a professional athlete on the racing track, loss of body part/death due to skydiving and other risky sports etc. are excluded from the coverage.
Click here to know what is covered under group personal accident Insurance
Case for Accidental Death & Dismemberment Insurance
Harsh Chauhan, an engineer, works for an engineering firm as the chief architect and designer. While his job gives him rather a safe environment to work in, he had bought an AD&D rider along with his life policy on the insistence of his insurance advisor.
Last month, while returning home from the office, late at night, he met with a very unexpected accident. Though his car was damaged beyond recovery, miraculously he survived, with minor scratches. To his amazement, he had suffered a concussion in his right ear and lost his eyesight for few weeks in the right eye.
He called his advisor to personally thank him for insisting AD&D cover for him as without it, his treatment expenses for the eye has to paid by himself. His hearing damage is permanent but fortunately, he did not have to spend money on hearing aid due to the compensation received from the insurer.