Accidental Death and Dismemberment Benefits
The customer purchase policy to deal with uncertainty in life. One of the biggest uncertainty of life is death. To deal with this type of threats customer purchase life insurance policy. The customer’s nominee will get compensation for the policy if their is any unfortunate incident with the customer. To understand Accidental death and dismemberment benefits, we need to understand policy related details.
The policy issuer pay compensation if the cause of death of policyholder is accident. If your policy providing accidental death benefits then the cause of death should be unfortunate accident. The Dismemberment benefits customer will be compensated for the loss/loss of use of Body part/functions. That means if because of incident your body part or any function stopped working in this type of situation you will get compensation. The customer need to check for both Accidental Death and Dismemberment Benefits.
The indian government also launched personal accident policy for the people. The insurance known as Pradhan Mantri Suraksha Bima Yojana.
What is Accidental Death and Dismemberment Benefit?
In insurance, accidental death and dismemberment is a policy that pays benefits to the beneficiary if the cause of death is an accident. This is a limited form of life insurance which is generally less expensive, or in some cases is an added benefit to an existing life insurance policy.
A supplementary life insurance policy benefit that provides for an amount of money in addition to the policy’s basic death benefit. This additional amount is payable if the insured dies as the result of an accident or if the insured loses any two limbs or the sight in both eyes as the result of an accident.
This benefit is included in Health Insurance or Life insurance policy. This benefit is provided by many insurance companies at added cost to your premium. Dismemberment includes the loss, or the loss of use, of body parts or functions.
There are many examples of celebrities who insured their body part. Because it is important in their earning money. Before buying dismemberment coverage, you need to understand the limitations. You should carefully read the terms of the policy. The Accidental Death and Dismemberment Benefits also known as AD&D policy. The customer can purchase supplementary AD&D policy to increase the cover.
Also read : Principles of Insurance
Remember in the most of insurance policy itself mention list of events and circumstances that void the insured’s entitlement to his or her accidental death benefit. In certain cases customer lost their entitlement of accidental death benefit. The prime example of this matter is Drunk and Drive. In cases of Drunk and drive related cases insurer deny accidental death benefits.
If the death happened via suicide then most of insurance company deny the claim. But in recent time only limited companies give insurance amount if the accident death happened via suicide. The term insurance policy holder should check incidents list which make their claim void.
Note, Some policy excludes death benefits when the insurer is in the influence of drugs, alcohol. In influence of Drugs and alcohol, the probability of risk increase. if The accidental death happened in influence of drugs and alcohol then policy insurer deny the compensation.
Even the insured person took his/her life via consuming poison. Then this incident can void death benefit in policy. In recent times, many companies cover the above incident while paying more premiums. Also, many Insurance policies has a waiting period before you will get accidental death benefits.
After the waiting period is over, the insurance company puts certain clauses like the insurance company have the right to investigate the death before giving the accidental death policy amount.
This type of restriction helps the insurance company to fight against fraud. It is right that this restriction makes the process of claim long, and the client’s family feels uneasy sometimes. Typical exclusions (reasons not to pay out) are :
- Death during surgery. (In this situation, insurer family can go to consumer court for the hearing. The court will decide who will compensate and which amount will be settled.)
- Accidents caused by mental or physical illness. The policy insurer only issue the policy to the customer who are mentally fit (No mental illness).
- Dangerous activities and risky behavior by the customer.
- Flying except as a passenger on a scheduled airline. Even Airline companies and Debit card companies provide insurance to the flyers
- Illegal activities. Narcotics activities included in illegal activities.
- Accidents which are believed by the insurance company not to be accidental deaths. If the death looks suspicious then there will be investigation. If the company found that the insurance holder’s death is not a accidental death then they will not compensate.
People can get this benefit in health insurance and life insurance policy. Dismemberment includes lost body parts. i.e like loss of finger, toes, hand, legs, limbs, eyes, paralysis situation.
Here the amount paid to the insured person is varied by insurer and package and is explicitly enumerated in the insurance policy.
In term policy, if the accident make the customer unfit for work then company provide dismemberment benefits. In many health insurance policies, company is liable to pay salary related compensation if there is loss of salary by customer. The customer compensated for the certain period in the health insurance.
The dismemberment benefits provide for the loss of the body part. Example : If the insurance holder met with an accident and loss his leg. In this type of case, customer compensated for the loss of earning happened due to accident. You must read policy document to check Accidental Death and Dismemberment Benefits in the policy.
The Accidental Death and Dismemberment Benefits help the customer to get right amount of compensation. The accident policy is must for the rider. The Indian Government recommend to have accidental death cover of minimum 15 lakh Rs. So you need to buy accidental death cover along with your vehicle policy.
The information was updated on 27-11-2021. If you have any question regarding Accidental Death and Dismemberment Benefits then comment below.