Life Insurance vs. Accidental Death & Dismemberment Insurance

AD&D insurance covers accidental death and some injuries but isn't a replacement for life insurance.

Colin Lalley 1600Rebecca Shoenthal author photo

Colin Lalley & Rebecca Shoenthal

Published October 1, 2020


  • Accidental death and dismemberment insurance (AD&D) does not cover death from natural causes

  • Life insurance offers more coverage for a comparable price

  • AD&D should never be a substitute for term life insurance

What’s the difference between life insurance and AD&D?

Life insurance provides financial protection for your family in most cases of death and will pay out if you die by accident or illness. Accidental death and dismemberment (AD&D) insurance only pays out in certain instances of death by accident, but not for natural causes or illness. It also provides benefits for some non-death accidents, such as if you lose a limb or digit.

Life insurance and AD&D insurance overlap slightly and cover similar instances of death, but it’s important to know the difference between the two to understand when AD&D coverage may not protect you.

We weighed the pros and cons of life insurance vs. AD&D coverage based on what each actually covers, how much they cost and how easy they are to get. For most people, we recommend life insurance over AD&D coverage because it’s comparable in price and covers more causes of death.

Life insurance vs AD&D: Coverage comparison and differences

Death by natural causes, sickness, or diseaseYesNoYes
Death by drug overdoseYesNoYes
Death by suicideYesNoYes
Death by accident (car crash, airplane crash)YesYesYes
Death by murderYesYesYes
Loss of limb, sight, hearing, or speechNoYesYes




We calculated the average monthly premium for 35-year-old non-smoking males with preferred-plus health ratings for a $500,000, 20-year term life insurance policy in North Carolina based on rates from ten carriers offering policies through Policygenius, including AIG (New York, NY), Banner (Phoenix, AZ), Brighthouse (Charlotte, NC), Lincoln Financial (Radnor, PA), Mutual of Omaha (Omaha, NE), Pacific Life (Newport Beach, CA), Protective (Birmingham, AL), Prudential (Newark, NJ), SBLI (Woburn, MA), and Transamerica (Cedar Rapids, IA). The average monthly premium for a term policy + accidental death and dismemberment rider is based upon the same profile, based on rates from four carriers offering that coverage through Policygenius, including AIG, Mutual of Omaha, Prudential, and Transamerica. Referenced policies may vary by carrier. Not all policies are available in all states. AD&D rate is for a 35-year old male in North Carolina, with a $500K policy issued by Mutual of Omaha (Omaha, NE). Individual rate will vary as eligibility and availability will affect each customer’s rate. Rate illustration valid as of 9/29/20.

Note that AD&D insurance has some exclusions, including injuries sustained before coverage and death while participating in riots. Each state may have its own exclusions for what AD&D insurance will cover.

Life insurance basics

Life insurance provides financial protection to loved ones if the policyholder dies. Premiums are paid on a monthly or annual basis, and the death benefit is paid out to named beneficiaries. Life insurance helps breadwinners provide for loved ones who rely on their income.

The most common types of life insurance are:

  • Term life insurance – Expires after a number of years outlined in the policy.
  • Whole life insurance – A type of permanent life insurance; remains active as long as premiums are paid, and contains an investment-style cash value.

A term life insurance policy is the best option for most shoppers, because it’s affordable and straightforward.

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Pros of life insurance

Life insurance is a good option for anyone who has people who rely on their income to pay off debts, make ends meet for everyday expenses, and plan for the future.

  • Provides no-strings-attached, tax-free death benefit if the policyholder dies
  • Cost-effective compared to other forms of financial protection

Cons of life insurance

While life insurance is a smart purchase for most people, there are some instances when you don’t need it:

Accidental death and dismemberment (AD&D) insurance basics

As the name implies, an AD&D policy covers death from accidents. That means it doesn't cover death from natural causes like old age, or deaths from terminal illnesses.

AD&D insurance will also pay out some of the benefit in some instances of injury or accidental loss of limbs. While the full payout will only come if you're killed in an accident, an accident resulting in an injury may pay out a portion of the benefit. Your policy will outline how much of the benefit you'll receive for which injuries.

Pros of AD&D insurance

Accidental death and dismemberment insurance isn’t as important as other types of insurance, but still has a place for some financial protection plans:

  • Provides additional peace of mind in conjunction with a life insurance or disability insurance policy.

Cons of AD&D insurance

  • Offers limited coverage
  • Poor substitute for proper life insurance
  • More common as a rider than a standalone policy

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Do you need AD&D insurance if you have life insurance?

Some insurance brokers try to push accidental death and dismemberment insurance as a substitute for life insurance, especially for young shoppers. Because young people are more likely to die from an accident than from illness or natural causes, the argument is that AD&D insurance is the smarter buy.

However, AD&D insurance is not a substitute for life insurance. Part of life insurance is planning for the future; a 30-year-old may not need a $500,000 life insurance policy today, but they lock in their price for the term of the policy. Life insurance gets costlier as you age, but if you buy it now, the affordable rates you pay today are what you’ll pay in 20 years when you’re more likely to need life insurance.

Meanwhile, if you rely on AD&D insurance for 20 years, you’ll need to buy a life insurance policy when you’re older and when you’ll likely end up paying much more for the policy.

Add that to the fact that life insurance covers more instances of death than AD&D insurance, for a comparable or cheaper price, and it’s clear that life insurance is the more valuable policy.

Accidental death and dismemberment riders

For someone who wants both life insurance and AD&D insurance, a rider is a viable option.

A life insurance rider is an addendum to a policy that provides additional coverage. An AD&D rider pays out an extra amount if death is due to an accident, but if the death is from natural causes, the policy simply pays out the base amount.

Ask an expert if the life insurance company you've chosen offers an AD&D rider.

Disability insurance

For shoppers who are more interested in coverage for the “dismemberment” portion of an AD&D policy, consider disability insurance. As with life insurance, AD&D insurance covers some of the same things as disability insurance, but a proper disability policy is more thorough and covers illness and temporary disabilities.

The bottom line: AD&D insurance vs. life insurance

Life insurance is the best choice for most shoppers because it covers more causes of death and is as affordable as accidental death & dismemberment insurance. AD&D can leave you without protection if you die from natural causes, sickness, disease, drug overdose or suicide. For those looking for the best of both worlds, adding on an AD&D rider to your life insurance policy is a better option than AD&D insurance alone.

Insurance Expert

Colin Lalley

Insurance Expert

Colin Lalley is the Associate Director of SEO Content at Policygenius in New York City. His writing on insurance and personal finance has appeared on Betterment, Inc, Credit Sesame, and the Council for Disability Awareness. Colin has a degree in English from the University of North Carolina at Chapel Hill.

Insurance Expert

Rebecca Shoenthal

Insurance Expert

Rebecca Shoenthal is an insurance editor at Policygenius in New York City. Previously, she worked as a nonfiction book editor. She has a B.A. in Media and Journalism from the University of North Carolina at Chapel Hill.

Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.

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