Accidental Death And Dismemberment Insurance - AD&D

AAA

DEFINITION of 'Accidental Death And Dismemberment Insurance - AD&D'

A rider attached to a life or health insurance policy. AD&D covers death by accidental means (rather than natural causes) and dismemberment, which includes loss of the use of certain body parts (including limbs or eyesight.) 

These riders are usually written in such a way that the insurer must pay double the amount payable otherwise, or a specific amount of continous income payments, and are sometimes called double indemnity riders. AD&D insurance is often offered by employers as an extra option on group health plans.

INVESTOPEDIA EXPLAINS 'Accidental Death And Dismemberment Insurance - AD&D'

It is important to carefully check the terms of AD&D policies. For example, if you are injured in an accident that later turns out to be fatal, the death must occur within a certain amount of time. To qualify for 100% of the dismemberment insurance, the injury may have to involve the loss of two limbs or both eyes. 

There is a schedule that lays out what percentage of the total will be paid for so-called partial dismemberment, such as the loss of one limb or the sight in one eye. Overall, AD&D is a limited policy that will be useful to a small percentage of people, so be sure to read the fine print in advance so that you understand exactly what is covered, and under what time frames.

RELATED TERMS
  1. Health Savings Account - HSA

    An account created for individuals who are covered under high-deductible ...
  2. Accidental Death Benefit

    The payment due to the beneficiary of an accidental death insurance ...
  3. Life Insurance

    A protection against the loss of income that would result if ...
  4. Rider

    A provision of an insurance policy that is purchased separately ...
  5. Indemnity

    Compensation for damages or loss. Indemnity in the legal sense ...
  6. First Dollar Coverage

    An insurance policy feature that provides full coverage for the ...
Related Articles
  1. Home & Auto

    Fighting The High Costs Of Healthcare

    If your employer is cutting medical benefits, a health savings account may be right for you.
  2. Insurance

    Life Insurance: Putting A Price On Peace Of Mind

    Would your death leave loved ones financially stranded? Find out how to ease your mind and keep them protected.
  3. Options & Futures

    Let Life Insurance Riders Drive Your Coverage

    Find out how these additional benefits can help you customize your policy.
  4. Options & Futures

    Critical Illness Insurance: Get Paid If You Get Sick

    This coverage will allow you to focus your attention on getting well, rather than getting by.
  5. Insurance

    Life Insurance: How Much Does Age Raise Your Rate?

    If you need life insurance, try to get it before your next birthday. Here's why.
  6. Retirement

    Healthcare: What Are You Really Paying For?

    Long-term care costs rise fast and long-term care providers bundle services together, making it tougher for families to understand what they are paying for
  7. Retirement

    4 Myths You Don’t Know About Medicare

    Here are four common misconceptions about Medicare, the federal government’s health insurance program for people who are 65 and older or disabled.
  8. Professionals

    Does the Middle-Class Need LTC Insurance?

    Long-term care insurance is as expensive as it is necessary for many people, but is it right for all financial advisor clients?
  9. Insurance

    What Happens If Your Insurance Company Goes Bankrupt?

    When insurance companies go bankrupt or face financial difficulty, it's bad news for policy holders.
  10. Insurance

    Which States Have the Cheapest Home Insurance?

    You can't choose where you live by its insurance rates. But if you did, these are the states to pick.

You May Also Like

Hot Definitions
  1. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  2. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  3. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  4. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  5. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center