A Truck is Not a CarRecently, a disturbing lawsuit involving an Accidental Death and Dismemberment (AD&D) policy claim in Canada was brought to my attention. An employee at an accounting firm had been killed in an accident while driving a company-rented vehicle to a business meeting. Her survivors were denied the AD&D insurance payment because the company-rented vehicle was a pickup and the policy only covered cars. The deceased employee’s family argues that this distinction was not spelled out clearly enough and filed a suit against the employer and the insurance company. The suit has not yet been resolved, but this case underscores the importance of understanding your coverage.
Cost Effective But Often Limited
AD&D can be a cost effective way to boost your insurance coverage, but the policies may be very limited in what they cover, and the coverage may vary widely from policy to policy. You must read your own policy to find out not only what the policy covers but also under what circumstances.
Stipulations and Conditions
In some cases, there may be stipulations to the coverage. For example, there may be a requirement that your death or injuries occur within a certain time frame from the accident date. You (or your heirs) may have to provide burdensome proof that the injury or death was indeed the direct result of the accident rather than simply something that happened afterward. In dismemberment cases, there may also be different benefits for losing one member (hand, foot, limb, or sight in one eye) versus two.
Read the Policy!
With any insurance coverage, it makes sense to read over the policy before you decide to commit to payment. If your company is paying for it, it is still a good idea to check what is covered, because if you are counting on that additional benefit in an accident situation, you should know exactly what constitutes an accident and what things are included. If your work coverage does not cover the right things for your profession, you may want to explore your own policies, or you may simply elect to purchase more regular life insurance.
AD&D can be the right choice for many people, but as with any form of insurance, it is up to you to research and select the right policy.
Suzanna de Baca is President of Private Capital Solutions Group. She is a Registered Representative and Financial Advisor of Park Avenue Securities LLC (PAS), 7 Hanover Square, New York, NY 10004, (888) 600-4667. Securities products/services and advisory services are offered through PAS, a registered broker/dealer and investment advisor. Private Capital Solutions Group is not an affiliate or subsidiary of PAS.
PAS is a member NASD, SIPC.
Material discussed is meant for general illustration and/or informational purposes only and it is not to be construed as tax, legal or investment advice. Although the information has been gathered from sources believed reliable, please note that individual situations can vary, therefore the information should be relied upon when coordinated with individual professional advice.
Related:
- "My Family Does Not Deserve This Retribution"
- Have You Considered Buying Critical Life Insurance?
- On Health Insurance and the Random Ten Batocchio, in the comments
- Senior Life Insurance
