What Is an Accidental Death Benefit, If you pass away as a result of an occupational accident that was not the result of your deliberate negligence, an accidental death benefit may be provided to an eligible beneficiary.
Definition and Examples of Accidental Death Benefit
If an insured person passes away as a result of a work-related injury that is covered by insurance, then an accidental death benefit must be paid. The accidental death benefit is paid in addition to the face amount of your life insurance policy to your chosen beneficiary. If you pass away as a result of COVID-19, some companies or benefit plans, like the New York Teachers’ Retirement System, may also make sure that your beneficiaries receive an accidental death benefit.
- Alternate name: double indemnity benefit
How an Accidental Death Benefit Works
Your designated beneficiary will also be paid out from your life insurance policy if you pass away in an accident while carrying out work-related tasks. The insured must not have acted intentionally negligently to cause the workplace accident.
You should regularly review your retirement information to make sure that your beneficiary designations still represent your current preferences because the accidental benefit distribution is paid to your most recently chosen beneficiary. Your death benefit will be distributed in the following order, even though you may nominate any individual, trust, or organization to receive it:
- Your surviving spouse, known as the primary beneficiary
- Your surviving children until they attain 25 years of age
- A dependent parent or parents
- Any other individual who qualifies as a dependent
If all of your primary beneficiaries pass away before you do, you can also name a dependent beneficiary to collect your death benefit. The bequest will be distributed evenly among all heirs until you indicate the specific percentages to be paid. If no beneficiaries exist, the death benefit will be paid to the executors of your will.
How To Get Accidental Death Benefits
It’s possible that an insured individual who was hurt or killed won’t get the chance to report a work-related accident. Given this, their beneficiary must submit an application for accidental death benefits within two years after the occurrence that led to the insured’s death to avoid having benefits rejected.
You may still be eligible for payments if you submit your claim for accidental death benefits more than two years after the work-related accident occurred in the following situations:
- Within 90 days of the incident, a notification was sent to the retirement board.
- For the injuries that resulted in the death, there is documentation of payments made under workers’ compensation.
- The department of the insured has a record of the injury that was sustained.
Accidental Death Benefit vs. Life Insurance Benefit
Although your beneficiaries will get accidental death and life insurance payments upon your passing, a payout is not always guaranteed. Accidental death benefits are only paid out when the insured dies as a result of a covered accident, as opposed to conventional life insurance benefits, which are given to your beneficiaries when you pass away.
| Accidental Death Benefit | Life Insurance Benefit |
|---|---|
| Paid out when the cause of death is a covered accident | Paid out when you die of any incident, including an accident |
| Beneficiaries may receive it in addition to your life insurance policy’s face amount | Beneficiaries receive the face amount of your life insurance policy |
| No medical exam is needed to purchase accidental death insurance | You may have to undergo a medical exam to purchase life insurance |
However, your accidental death insurance policy may also be a rider on your life insurance policy. You can get either conventional life insurance or accidental death insurance as a single policy. If you pass away in a qualifying accident, your beneficiaries will get both your accidental death benefits and the full face value of your life insurance policy.
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