Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
AD&D stands for Accidental Death and Dismemberment. This type of coverage only pays a death benefit when certain conditions are met. If the insured dies by illness, the policy pays out nothing. For example, if the insured dies in a car accident, the policy would payout the proceeds to the beneficiary. However, if the insured dies of an illness (e.g. a heart attack), no proceeds will be paid to the beneficiary. This type of coverage can be extremely cheap, however, the risk of dying by accident is very nominal compared to the risk of dying by illness, especially as you get older.
Full coverage policies feature higher premiums than AD&D policies, but are very affordable and the ability for the policy to pay proceeds in the event of death by illness is crucial.
There actually are not any policies that I know of called AD&D Life Insurance.
AD&D policies pay proceeds for death or dismemberment caused by accident, and the death or dismemberment must occur within a certain amount of time from when the accident occurred.
Life insurance policies pay for loss of life, period, regardless of how death occurred (with very few exceptions, such as suicide during the first two years).
Some Life insurance policies offer an accidental death and dismemberment rider that causes the policy to pay double if death is caused by accident. Those type of policies still pay a death benefit for death due to illness, as well.
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Full coverage policies feature higher premiums than AD&D policies, but are very affordable and the ability for the policy to pay proceeds in the event of death by illness is crucial.
AD&D policies pay proceeds for death or dismemberment caused by accident, and the death or dismemberment must occur within a certain amount of time from when the accident occurred.
Life insurance policies pay for loss of life, period, regardless of how death occurred (with very few exceptions, such as suicide during the first two years).
Some Life insurance policies offer an accidental death and dismemberment rider that causes the policy to pay double if death is caused by accident. Those type of policies still pay a death benefit for death due to illness, as well.