What is Accidental Death Insurance? A 2024 Guide

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Alexandre Desoutter updated on 7 November 2023

Accidental death insurance becomes your safety net, shielding your family from financial hardship during unforeseen crises. It's your assurance that, in times of need, your loved ones will be cared for even in the worst circumstances.

But what does accidental death insurance cover? How do you find the right policy? What does it cost? We've got you covered.

Read our comprehensive guide to understand how accidental death insurance works, its pros and cons, and how you can buy a policy. You can also use our free comparator to compare the best plans in the market and get free insurance quotes in seconds.

Accidental death insurance: 5 key takeaways

  1. Accidental death insurance offers financial protection for unexpected accidents.
  2. It complements traditional life insurance but has specific accident coverage.
  3. Exclusions exist; payouts are for specific, sudden, unforeseen accidents.
  4. Cost varies by provider and policy; often affordable as a rider.
  5. Consider lifestyle and risk factors when deciding on coverage.

What is accidental death insurance?

Accidental death insurance is sometimes known as accidental death and dismemberment insurance. This is because as well as covering you in case of death by accident, many policies also cover serious injury such as the loss of a limb.

Good to know

Dismemberment is legally defined as the complete severance of one arm or one leg at or above the wrist or ankle joint, or the complete and irrecoverable loss of the sight of one eye.

Accidental death insurance is usually sold as an add-on to an existing life insurance policy. It should not be used as a replacement for life insurance. If you do not have a life policy in place, consider proceeding with that before buying an accidental death policy.

However, finding the right policy is no mean task and you need to look at multiple options before deciding on one. Worry not, we've made it simple for you. You can use our comparator below to compare the best life insurance policies in Canada with accidental death insurance based on your needs and get free quotes in seconds.

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What is international accidental death insurance?

International accidental death insurance provides coverage for accidental death or dismemberment that occurs while the insured individual is traveling or residing outside their home country. This insurance is designed to offer financial protection in the event of a fatal accident or a significant injury resulting in dismemberment, paralysis, or loss of sight, hearing, or limbs while abroad.

Pros of accidental death insurance

  • Affordable option for budget-conscious individuals.
  • Quick payout for covered accidental deaths.
  • Additional benefits for dismemberment and serious injuries.
  • No medical exam or extensive underwriting required.

Cons of accidental death insurance

  • Coverage excludes natural causes and illnesses.
  • Specific exclusions may restrict eligibility for payouts.
  • Lower payouts than traditional life insurance.
  • No cash value or savings component.

What is accidental death insurance payout?

An accidental death insurance payout, also known as a death benefit, is a lump-sum payment provided to the beneficiary or beneficiaries of an insured individual in the event that the insured person dies as a direct result of an accident covered by the policy. The payout is typically a fixed amount specified in the insurance policy and is not dependent on factors like the insured person's age, health, or medical history.

Who offers accidental death insurance Canada plans?

Most major companies in the industry offer accidental death coverage as an add-on under slightly different names. Providers include including:

ProviderPolicy name
Accidental Death and Dismemberment Insurance
Alberta Medical Association's Accidental Death & Dismemberment (AD&D) Insurance
BMO Accidental Death Benefit Insurance (also commonly referred to as BMO Accidental Death Insurance)
CIBC Accident Protection Plan (also commonly referred to as CIBC Accidental Death Insurance)
Accident Insurance
Scotiabank Accidental Death Insurance
Sun Life
Sun Life Go Accidental Death Insurance
TD Accidental Death Insurance
Accidental Death Insurance Canada

What does accidental death insurance cover?

So you're probably wondering what is considered accidental death for insurance purposes. The definition of what is considered accidental death can be a bit tricky and policies tend to have a long list of exclusions and qualifications. Let's take a look at the conditions and definitions of a sample policy from TD's life Insurance.

Firstly, an 'accident' is defined as being "sustained directly and independently from all other causes". This means, for instance, that if a policyholder died or was seriously disabled by a disease they would not be eligible for a pay-out. In this case, you would be better served by purchasing critical illness or long-term disability insurance.

Critical Illness
Acute heart attack, life-threatening cancer, stroke
Suicides and deaths that happen while committing a crime are not covered
Loss of arm
Arm lost from wrist up
Loss of leg
Leg lost from ankle up
Total severe of spinal cord
Loss of sight
Total loss of sight in both eyes
Accidental death definitions

You can compare the coverages offered by various providers for accidental death right here in detail. Simply use our free comparator below and compare multiple plans and get quotes in seconds.

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What does accidental death insurance not cover?

The following are excluded from coverage by an accidental death and dismemberment coverage policy:

  • suicide and self-mutilation
  • death or dismemberment that happens while committing a crime
  • accidents due to intoxication
  • accidents occurring during a normal pregnancy

How much does accidental death insurance cost?

Accidental death coverage is usually a rider on a life policy. Let's take a look at some of the rates from leading providers for a 33-year-old individual with no dependents for $100,000 of coverage:

ProviderCost of accidental death plans
Cost of accidental death plans

Is accidental death insurance worth it?

The answer to this question depends on your individual circumstances. Do you live a life that puts you at heightened risk of having a serious accident? In 2018 just 6% of all annual deaths in Canada were due to injury and poisoning. Of that 6%, nearly a fifth were as a result of opioid overdoses, something specifically excluded by every accidental death policy.

Accidental death protection is relatively cheap compared to term life because the odds are that you will probably not collect on it. On the other hand, you may have a job or a lifestyle that puts you at a level of risk above the national average. Let's take some examples:

How to get the best accidental death insurance policy?

  1. Research Providers: Start by researching companies in Canada that offer accidental death coverage policies. Consider their reputation, customer reviews, and financial strength.
  2. Compare Policies: Compare multiple AD&D insurance policies to understand their coverage, exclusions, and costs. Look for policies that align with your specific needs.
  3. Evaluate Premiums: Assess the premium costs for each policy. Ensure it fits your budget while providing adequate coverage.
  4. Understand Exclusions: Pay close attention to policy exclusions. Be aware of any circumstances or activities not covered by the policy.
  5. Consult an Agent: Consider consulting with an insurance agent or broker who can provide personalized advice and help you find the best accidental death insurance policy that meets your requirements in Canada.

While the aforementioned steps could seem like a time-consuming process, we've made it simple for you. You can use our free comparator below to compare the best life insurance plans with accidental death insurance coverage and get personalized quotes in seconds.

Compare the best life insurance companies

Get 20+ quotes in seconds

How to compare accidental death insurance vs life insurance?

An accidental death insurance policy cannot replace traditional life policies. However, it can be an interesting add-on. But what is the difference between life insurance and accidental death insurance? The crucial difference between the two is that a life policy only pays out when you die, whereas accidental death pays out in case of a serious, mutilating accident.

However accidental death does not pay out if you are disabled as a result of illness. Also, as we have seen, there are many exclusions that might prevent a benefit from being triggered, including the legality of your actions, the intentionality of your actions, and your state of intoxication.

If you are working in a high-risk industry, like login or fishing then it may make sense as an add-on. For more generalized coverage, it probably makes sense to combine a term life insurance policy with critical illness insurance or long-term disability insurance.

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Alexandre Desoutter

Alexandre Desoutter has been working as editor-in-chief and head of press relations at HelloSafe since June 2020. A graduate of Sciences Po Grenoble, he worked as a journalist for several years in French media, and continues to collaborate as a as a contributor to several publications.