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Accidental death and dismemberment insurance policies are most commonly offered as a voluntary employee supplement to a life insurance policy. Depending on how your benefit program is set up – and your decision as an employer regarding what you’d like to make available to your employees – you have the option of making available either a separate policy, or an AD&D rider to an existing life insurance plan.
 

Double Indemnity

AD&D takes advantage of “double indemnity.” If your employee has an existing life insurance policy and an AD&D policy and dies because of a covered accident, his or her beneficiary is entitled to payouts from both policies. Thus, if the AD&D policy is set up as a rider to life insurance, the policy benefit doubles. (If it’s set up separately, the payout from the AD&D policy would be whatever coverage protection is contractually agreed upon in the plan.)
 

AD&D Policy Costs

Accidental deaths are not common. According to the Centers for Disease Control and Prevention, they are the fourth-most likely cause of death in the U.S. – about 45 per 100,000 per year. Because the events that give rise to an AD&D claim are fairly rare, these policies tend to very affordable, usually costing a lot less than a life insurance policy with a similar payout.

Game Plan

Unlike some types of life insurance, AD&D is not an investment vehicle. If you plan to offer an AD&D policy to your employees, make sure they’re given the opportunity to know what kinds of protections it provides – and what’s excluded.
 
Like other voluntary benefits, AD&D premiums are usually paid by the employee as a payroll deduction.
Need Business Insurance?

Need Business Insurance?

For more than 200 years businesses have trusted The Hartford. We can help you get the right coverage with an online quote.
 
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