What To Know About AD&D Insurance – Forbes Advisor

Some people mistakenly think that having AD&D insurance is a financial safety net if someone dies unexpectedly. “It gives them a false sense of security,” Voegele says. Because AD&D provides limited coverage, it isn’t right for everyone.

You don’t have to take a medical exam to get AD&D insurance. And you don’t have to answer questions about your health, which can make this type of policy appealing to people with pre-existing conditions that make it difficult to find affordable life insurance.

You won’t be denied coverage because of your health. You just have to meet the age requirements. Typically, you must be between ages 18 and 70 or 80.

You can get coverage quickly. Because there are no lengthy questionnaires to fill out, no medical exams to take and no waiting period, you can get approved for a policy within a matter of days or even minutes for some policies purchased online. 

Coverage is limited. AD&D will only pay out if the death or injury was a result of an accident—and there are plenty of ways to die other than an accident. This limited coverage is a big drawback.

Coverage isn’t as cheap as it seems. An AD&D policy will cost less than regular life insurance. But that’s because the chance of an AD&D payout is relatively low. “The odds of you using it are so far down the scale that it becomes expensive for the payout,” Voegele says.

You might lose your coverage if you leave your job. Most people who have AD&D insurance get it through a group plan at work, Voegele says. Often, you can’t keep that coverage if you leave your job.