What Is Voluntary Accidental Death & Dismemberment?

AD&D insurance has provisions specific to accidents

Voluntary accidental death and dismemberment insurance is often called AD&D insurance. It is not ordinary life insurance and it is not related to health insurance. It is a supplemental kind of insurance coverage that pays its benefits in the event of death or certain permanent physical impairments as the result of an accident.

Voluntary Insurance

When an employer offers insurance programs in which an employee can elect to enroll, these beyond-the-basic offerings are often called voluntary insurance programs. These programs, offered as an adjunct to subsidized insurance and paid for by the employee, help round out the employee benefit package. In many instances, companies offer such programs to employees and include their enrolled dependents.

Accidental Death

Accidental death coverage is life insurance that pays only in the event of death from accidental causes. The insurance pays an enrolled person's beneficiary if the insured person dies in an accident. The insurance pays a benefit to the enrolled individual if a covered dependent dies in an accident.

Covered accidental death usually includes accidents that occur anywhere, including during travel and pay in addition to any other coverage the enrolled person might have. It is important to read and understand the terms and exclusions of the insurance to know what is and is not covered.

Accidental Dismemberment

The policy provisions spell out what constitutes accidental dismemberment. Often, the dismemberment benefit will pay a portion of the accidental death benefit for accidents in which the enrolled person or enrolled dependent would suffer the loss of any or all limbs, be paralyzed, lose sight, hearing, speech or specific combinations of injuries that inhibit mobility and activities of daily living. As with accidental death insurance, the person enrolling should understand the terms, limitations and exclusions of the insurance.

Additional Benefits

Some voluntary AD&D insurance plans have additional coverages that may be attractive to plan purchasers. One of these is known as accelerated death benefit. If the insured person is diagnosed with disease that limits his life expectancy to a year or less, in other words if he has a terminal illness, he can receive some of the life insurance benefit during his lifetime. The balance of the benefit is paid to his beneficiary after his death.

Another benefit available in some states is called an education benefit. It pays an amount of the insured person's life insurance benefits toward a dependent's college education for a limited amount of time if the insured person dies in an accident while he is covered by the plan.

Other options may include paying an additional amount if the insured person dies in an auto accident while wearing a seat belt. Still another pays for the repatriation of remains if the insured person dies far from home.