Short Description: Policy that pays out in the event of the insured’s death as a result of an accident or incapacitating bodily injury.
Long Description: Typically, this coverage is written in conjunction with group life insurance contracts. The accidental death portion provides double indemnity coverage if death is caused by an accident, and the dismemberment portion provides benefits for the loss of a specific body part (e.g., eye, hand, leg). For example, if a member of the group dies of natural causes, the group life contract may provide £100,000 in coverage. If the death was caused by an accident, the benefit is £200,000. If an accident causes the loss of an arm rather than death, the benefit could be £50,000. Some AD&D riders pay half the benefit amount if the insured loses a limb or vision in one eye.
See Also: Double Indemnity.