Accidental death life insurance only covers death due to accident, such as car accident, falls, drowning, etc. Life insurance, on the other hand, covers death due to accident or any other cause. Far more people die from natural causes (illness, complications of medical treatment, etc) than accident. Therefore, accidental death coverage costs less than life insurance because it pays out far less often than life insurance does.
Life & Health Insurance Agent, The Tooker Agency, Riverhead NY
If you have an accident policy you should read through it carefully. It is very common for accident policies to have a lot of conditions and exclusions. For example it may state that you must die within 90 days of the accident itself in order for the death benefit to be paid. Other common exclusions are for death while committing a crime, death while intoxicated or under the influence of drugs.
While we often like to think that we will die of accidental causes (especially young people), that is simply not the case. As Peggy mentioned above, accidental death policies have much lower premiums than life insurance policies because there is a very small risk of death by accident.
One final consideration is if the financial impact to your family will be different depending on the cause of your death. Will your family need more money if you die in a car accident versus having a heart attack? If anything, death by natural causes may bring more financial burden if it is preceded by a lengthy illness. You can use an accident policy as a supplement to your life insurance, but never as a replacement.
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While we often like to think that we will die of accidental causes (especially young people), that is simply not the case. As Peggy mentioned above, accidental death policies have much lower premiums than life insurance policies because there is a very small risk of death by accident.
One final consideration is if the financial impact to your family will be different depending on the cause of your death. Will your family need more money if you die in a car accident versus having a heart attack? If anything, death by natural causes may bring more financial burden if it is preceded by a lengthy illness. You can use an accident policy as a supplement to your life insurance, but never as a replacement.