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.
Understanding Of accidental death and dismemberment
- Accidental Death
- In most insurance policy insurer maintains a list of events and circumstances that void the insured’s entitlement to his or her accidental death benefit.
- Some exclusion like you have insured yourself with insurance policy but when your death happened with suicide, the Insurance company will not give your beneficiary death benefit. But in recent times, many companies cover suicide death in their policy.
- Death by illness, suicide, non-commercial aviation, war injury, and natural causes are generally not covered. But there is an exclusion in this policy. Read your policy document carefully to understand which is excluded.
- Some policy excludes death benefits when the insurer is in the influence of drugs, alcohol. Also consuming poison can void your 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 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.
- Accidents caused by mental or physical illness.
- Dangerous activities and risky behavior
- Flying except as a passenger on a scheduled airline.
- Illegal activities.
- Accidents which are believed by the insurance company not to be accidental deaths.
- Dismemberment Benefits
- 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.