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accidental death and dismemberment

Accidental Death Life Insurance

by Glenn on November 10, 2007

Most life insurance policies in Canada have a number of options available. These options are called ‘riders’ in the industry. One of the most prevalent riders is Accidental Death.

The Accidental Death rider pays out an additional death benefit should you die as the result of an accident. That may sound nice, but it’s important to remember that this rider costs money to buy; it’s not free.

I don’t recommend Accidental Death life insurance and here’s why. If done properly, you should know how much life insurance you need. If you die as the result of an accident do you all of a sudden need more life insurance? I don’t know of a single instance where more life insurance is needed because of ‘how’ you die. If you’re buying mortgage life insurance you don’t need more life insurance because you died as the result of an accident. If you’re planning estate needs, those needs don’t change because you died as the result of an accident.

In short, if you need additional life insurance, buy it. If you don’t need additional life insurance, don’t spend your money. The amount of insurance you need doesn’t change as a result of how you died.