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Q

Would an accidental death policy pay for a cocaine overdose?

A

No, typically an accidental death policy would exclude death caused by intoxication or illegal drug use. Other exclusions usually include loss caused by the commission of a felony by the insured, active duty or training in the military or suicide.

Accidental death and dismemberment (AD&D) policies pay out a benefit if you die from an accident or lose a limb or eyesight. Some also provide benefits for paralysis or coma. Policies specify that to receive benefits, the injury or death must occur within a certain time frame after the accident, and your death must be a direct result of the injuries sustained in the accident. The policy would not pay out if death resulted from a physical or mental illness.

AD&D coverage is sold through standalone policies, which can be purchased individually or through a group. Coverage may also be offered as a rider on life insurance policies. Many employers offer AD&D insurance for their employees because it provides coverage to supplement life and disability insurance at a relatively small price. Accidents account for only about 5 percent of deaths, which is why the premiums for AD&D are low.

AD&D insurance should be considered a supplemental policy, not a replacement for life insurance, which provides protection whether you die from an accident or illness.

For more, see the basics of accidental death and dismemberment insurance.

Last updated: Jul. 1, 2016
By
Ask the Insurance Expert
Penny Gusner Consumer Analyst
Penny Gusner has been working in the insurance business for more than 10 years. She researches your questions, from the routine to the bizarre, with equal enthusiasm. Read More

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