Legal Definitions - ADB

ADB stands for Accidental Death Benefit.

An Accidental Death Benefit (ADB) is an additional payment that an insurance policy may provide if the insured person dies as a direct result of an accident, rather than from natural causes, illness, or suicide. It is often offered as a rider or an optional add-on to a standard life insurance policy, or it may be included in other types of insurance like travel or group policies. This benefit is paid out in addition to the policy's standard death benefit, but only if the death meets the specific criteria for an "accident" as defined in the policy.

• Example 1: Life Insurance Policy

  Sarah has a life insurance policy with a standard death benefit of $500,000. She also opted for an Accidental Death Benefit rider, which would pay an additional $250,000 if her death was accidental. Tragically, Sarah dies in a car accident. Because her death was accidental, her beneficiaries would receive the standard $500,000 death benefit plus the $250,000 from the Accidental Death Benefit, totaling $750,000. If she had passed away from a chronic illness, only the $500,000 standard benefit would have been paid.

• Example 2: Travel Insurance

  Mark purchases a travel insurance policy for his adventure trip abroad. This policy includes an Accidental Death Benefit of $100,000. While exploring a remote area, Mark is involved in an unforeseen hiking accident that results in his death. Since his death was directly caused by an accident during the covered travel period, his beneficiaries would receive the $100,000 Accidental Death Benefit provided by his travel insurance, helping to alleviate financial burdens during a difficult time.

• Example 3: Workplace Group Insurance

  A company provides its employees with a group life insurance policy that includes an Accidental Death Benefit. An employee, Emily, is involved in a fatal car accident while driving to an off-site client meeting as part of her job duties. In this scenario, Emily's death would likely be considered accidental. Her beneficiaries would receive the standard death benefit from the group life policy, and an additional payment from the Accidental Death Benefit provision, as her death was due to an accident that occurred during the course of her employment.