AD&D Insurance Explained
In the insurance industry, there are a number of different types of policies an individual can obtain to protect their interests from catastrophe. In addition, there are often specific policy types that essentially “branch off” of other more well-known policy types. So is the case for Accidental Death & Dismemberment (AD&D) Insurance policies. In general, these policies are a somewhat limited form of the standard life insurance policy. Some individual opt for this limited form of life insurance because of the lower premiums paid, while others feel that an accidental death is the only reason their families will not be taken care of. In this blog article, our goal is to educate readers on some of the basics of an AD&D policy. By doing so, readers may be able to determine if such a policy is right for them or not.
How Does AD&D Insurance Work?
Without going in to the more intricate details involved with an AD&D policy, the basic underlying idea for such a policy is that the insurance provider will pay out to beneficiaries in the event of a policy holder dying of an accidental death or suffering a dismemberment of body appendages in an accident. However, similar to any insurance policy, there are specifics as to what is or is not covered.
Accidents & Dismemberment Defined
It may come as no surprise, but the documents involved with an AD&D policy will generally spell out (in complex legalese) what qualifies as an “accident”. What exactly qualifies under the policy will depend on the insurance provider, but some examples of causes of death that are generally covered are homicide, car accidents, drowning or falling. If you suffer any injuries from such an accident that leads to death or dismemberment, the policy will generally pay out accordingly. To clarify the point of dismemberment, this is usually included to cover incidents where an accident causes a covered individual to lose an appendage. For example, if a car accident results in a covered individual needed an amputation of an arm, leg, finger or toe, the policy will generally pay out.
Just as the legal documents for the policy will spell out what it will pay out for, so will spell out incidents that may occur that are excluded from payout out. These exclusions exist for various reasons, but mostly to provide the insurance provider with a way out of paying. If you intend to obtain an AD&D policy, it is important for you and your loved ones to understand what is excluded. Death due to illness, suicide and other natural causes are just common examples of a long list of causes the insurance provider might hold as a reason to not pay out. This is somewhat understandable, as none of these illnesses are caused by accidents. If you wish to find a policy that includes such incidents, some insurance providers will do so at an additional cost.
Similar to life insurance, an AD&D policy will require an individual to file a claim to collect any payout on the policy. As such, an individual looking to collect may run in to many of the same pitfalls discussed in prior blog posts regarding life insurance claims. Similar to life insurance claims, AD&D policy claims are facing opposition from an insurance provider looking to boost its bottom line. If there is any chance to escape a claim, you better believe that the insurance provider will gladly go this route.
Whether you are the policy holder that has recently suffered a dismemberment or a beneficiary filing a claim based on the policy holder’s accidental death, there are certain procedures set up by the insurance provider that you will want to follow in order to properly file a claim. Once the administrative process is taken care of, you will need to wait out the process of the provider either approving, denying or delaying the claim. If you do receive unfortunate news, this is where you will want to analyze your legal options. If you have been faced with a similar situation, do not hesitate to reach out to our legal office to discuss how to proceed. If you have been wrongfully denied, we will fight for your right to a payout on the policy. If you have a denied AD& D claim, you need the right life insurance attorney who has handled countless claims so you get the full amount of the policy.