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An extra feature that can be included in a life insurance policy is the Accidental Death Benefit Rider. In the event that the insured individual dies as a result of an accident, it offers an additional benefit. The Accidental Death Benefit Rider expands the coverage to cover accidental deaths even though life insurance typically only covers deaths from natural causes.
What does a life insurance accident death benefit rider mean?
Accidental Death Benefit (ADB) Rider is an optional life insurance rider that policyholders can add for increased coverage at affordable premiums to their base plan. You can have a sizable ADB rider sum assured at relatively reasonable prices because the ADB rider premiums are paid along with the base premiums. In the event of the policyholder’s accidental death during the policy term, this rider will pay the nominee the additional rider sum insured on top of the base sum assured.
Do I Need a Life Insurance Accidental Death Benefit Rider?
The necessity of a life insurance policy’s accidental death benefit rider is entirely arbitrary. The ADB rider may or may not be necessary in your life. Yet, this rider gives the nominee an additional cash advantage in the tragic event that the policyholder perishes in an accident. With this rider, you can secure higher benefit amounts for lower premiums and guarantee your family’s financial security while you’re away. This benefit payment can be used by your family to cover expenses such as rent, child care costs, loan repayments, and any other debts that could become due while you are away.
How Does Accidental Death Benefit Rider Work?
If the policyholder passes away in an accident within the required waiting period, which is typically 180 days throughout the policy term, an Accidental Death Benefit Rider pays the beneficiary the benefit amount.
Let’s use an example to better grasp this:
Let’s say Palak purchased a $2 million, 10-year life insurance policy with a $50 lac accidental death benefit rider built into the standard plan. Suddenly, four years after acquiring the insurance, Palak is tragically killed in an automobile accident. If Palak dies within 180 days of the accident, the nominee will not get the base sum assured of 2 crores from the insurance until that time.
What are the advantages of life insurance accident death benefit riders?
The advantages of the ADB rider are listed below, and you can use them by adding the rider to the basic plan.
Additional Coverage: A benefit for accidental deaths Rider gives the policyholder and their family an additional benefit sum that will aid the nominee financially in the terrible event of the policyholder’s passing during the policy term.
No Medicals Required: This rider can simply be added to your base plan without any fuss, and you do not need to provide any medical records in order to do so.
Save More by Spending Less: You can raise the benefit amount your family receives in the event of your accidental death by adding the ADB rider to the standard plan for a small additional premium. Compared to new policy premiums for the same rider sum assured, the premiums for this rider are significantly less expensive.
Peace of Mind: A benefit for accidental deaths Rider gives the policyholder the much-needed assurance that, in the tragic event of their passing, their family will be financially secure and able to meet their demands.
How is Accidental Death Rider Different From Term Life Insurance?
There are some distinctions between ADB rider and term insurance plans, even though both offer the nominee a benefit sum in the event of the policyholder’s untimely death.
| Parameters | Accidental Death | Benefit Term Life Insurance |
| Benefit Amount | Usually much less than the Base Sum Assured | Equals to the Base Sum Assured |
| Payable | Only payable if the policyholder dies due to an accident | Payable under all circumstances covered under the term insurance |
| Purchase | It cannot be purchased by itself, has to be added to the base plan | It can be purchased by itself |
Accidental Death Benefit Rider Exclusions in Life Insurance
An active life insurance policy with the ADB rider included in the base plan may not pay out under the following circumstances:
- If the insured attempts suicide or causes self-harm, the rider will not offer coverage.
- if the policyholder engages in activities other than paying an usual fee as a passenger on a commercial trip, like as skydiving or extreme sports like paragliding.
- If the policyholder has broken the law or engaged in criminal activity
- The rider cover’s maximum age restriction has passed.
- if the policyholder is actively fighting in any form of battle.
Finishing up!
The Accidental Death Benefit Rider (ADB rider) in life insurance is the simplest approach to provide your family with a sizeable sum assured above the base value. To learn more about the specifics of the rider and its exclusions within each plan as it relates to your requirements, speak with your financial advisor. Afterwards, you can compare life insurance policies online to find the firms that provide this rider and buy the policy that best suits your needs.
