If you die due to an automobile accident in California, you can leave your family with a monetary payout. Obtaining an accidental death and dismemberment, or AD&D, insurance policy before the accident occurs offers this peace of mind. Understanding what it covers can help you decide if this protection is a tool you’d like to use.
What does AD&D insurance cover?
AD&D insurance is two different insurance types combined into one policy. One deals with the loss of a limb due to an accident, and the other policy covers death. As with a life insurance policy, your beneficiary will receive monetary support if you purchase this insurance and die in an eligible accident.
Significant limits
It’s important to read the fine print when you’re purchasing AD&D insurance. Doing so can help you examine the pros and cons of obtaining a policy. Only some accidents will be covered. However, due to these limits, the cost for an AD&D insurance policy can be significantly less than a traditional term life insurance policy.
Common situations
There are some common situations that might happen where you would be covered under an AD&D insurance policy. They include:
- Accidental death in a traffic accident
- Loss of a limb
- Loss of speech, sight or hearing
- Murder
Not covered by AD&D insurance
Knowing some of the situations where AD&D insurance wouldn’t apply can help you make a more informed decision before purchasing it. Here are a few to consider:
- Drug overdose death
- Drunk driving death
- Suicide
- High-risk occupations or hobbies
- Illnesses like cancer or heart attack
- Death by natural causes
Comparing the cost of a traditional term life insurance policy with an AD&D insurance policy can help you make a better decision. You’ll want to know what’s covered and what isn’t.
