Double Indemnity Life Insurance: What You Need To Know

Double indemnity is a clause or provision in a life insurance policy that requires the insurance company to pay double the face value of the policy to the beneficiary if the policyholder dies of accidental causes. This includes murder by someone other than the beneficiary of the insurance policy, and most accidental deaths. However, it excludes suicide, deaths caused by the insured person's gross negligence, and deaths from natural causes. Double indemnity policies are usually relatively inexpensive and often aggressively marketed, especially to people over 45.

Double indemnity life insurance explained

Double indemnity is a clause or provision that can be added to a life insurance policy. It is a form of life insurance that requires insurance companies to pay up to double the face value of a policy to the beneficiary if the policyholder dies of accidental causes. This can provide additional financial support for grieving families after the unexpected loss of a loved one.

Double indemnity is relatively inexpensive and often aggressively marketed, especially to people over 45. This is because accidental deaths are rare, accounting for only 5.01% of all deaths in the United States in 2006. Insurance companies rarely have to pay out double indemnity claims, as most deaths are caused by health problems or natural causes.

To qualify for double indemnity benefits, the beneficiary must prove that the policyholder's death was accidental. Insurance companies can have varying definitions of accidental death, but it generally includes intentional acts of violence or preventable accidents caused by a third party's negligence. For example, slip and fall accidents, choking or suffocation accidents, exposure to toxic substances, and defective machinery accidents. Most policies will only cover deaths that occur within 365 days of an accident and require evidence such as a police report, coroner's report, toxicology reports, and eyewitness statements.

It's important to note that double indemnity claims are evaluated on a case-by-case basis and will be denied if the death was not accidental. Common exclusions include medical conditions, self-inflicted injuries, suicide, drug overdoses, deaths caused by negligence, deaths sustained while attempting or committing a felony, and deaths that occur during a medical procedure or surgery.

While double indemnity can provide financial support for loved ones, it's important to carefully review the exclusions and conditions before adding it to your life insurance policy. Claiming double indemnity benefits can also be complex, requiring extensive documentation and time for the claim to be validated by the insurance provider.

Who is eligible for double indemnity life insurance?

Double indemnity is a clause in a life insurance or accident policy that requires the insurance company to pay double the face value of the policy to the beneficiary if the policyholder dies due to accidental causes. This includes murder by someone other than the beneficiary and most accidental deaths. It excludes suicide, deaths caused by the insured person's gross negligence, and natural causes. Double indemnity is relatively inexpensive and often marketed to people over 45.

People with certain jobs are not generally eligible for multiple-indemnity coverage. This includes people with dangerous jobs, such as heavy construction work, as well as children. For example, miners, oil rig workers, and race car drivers may not be eligible for this type of coverage due to the risky nature of their jobs.

To qualify for double indemnity benefits, the beneficiary must prove that the policyholder's death was accidental. Insurance companies may have varying definitions of accidental death, but it generally includes intentional acts of violence or preventable accidents caused by a third party's negligence. For example, slip and fall accidents, choking or suffocation accidents, exposure to toxic substances, and defective machinery accidents may be considered accidental deaths.

Most policies will only pay out if the death occurs within 365 days of the accident. Additionally, insurance companies will deny the claim if the death was not accidental, such as in cases of medical conditions, self-inflicted injuries, suicide, drug overdose, deaths caused by negligence, or deaths during extreme activities.

What is accidental death?

Accidental death is an unnatural death caused by an accident, such as a slip and fall, traffic collision, or accidental poisoning. Accidental deaths are distinct from deaths by natural causes, disease, suicide, or intentional homicide. However, an accidental death can still be considered a homicide or suicide if the person was unintentionally responsible.

In the context of insurance, accidental death is defined as an event that strictly occurs as a result of an accident. This includes situations beyond one's control, such as car crashes, slips, choking, drowning, machinery accidents, and other uncontrollable circumstances.

Accidental death benefits are often included as a clause or rider in life insurance policies. These benefits provide additional financial support to beneficiaries in the event of the policyholder's accidental death. The benefits typically extend for a specified period after the accident, usually up to a year, and may have an age limit set by the insurance company.

To qualify for accidental death benefits, beneficiaries must provide evidence to prove that the death was indeed accidental. This may include police reports, coroner's reports, toxicology reports, eyewitness statements, and medical records. Insurance companies have varying definitions of accidental death, but they generally include intentional acts of violence or preventable accidents caused by a third party's negligence.

It is important to note that insurance companies have strict parameters for what constitutes an accidental death, and they will often try to limit liability and minimize payouts. Exclusions to accidental death coverage may include acts of war, illegal activities, hazardous hobbies, and death from an illness.

When will an insurance company deny a double indemnity claim?

Double indemnity is a clause in a life insurance policy that requires the insurer to pay a stated amount in the case of accidental death. This is usually double the amount of the policy, but it can be triple or more. However, insurance companies will often try to avoid paying out these claims, as they are motivated by profits.

An insurance company will deny a double indemnity claim if the death was not accidental. Here are some examples of deaths that would not be considered accidental:

• A medical condition (e.g. cardiac arrest, COVID-19, etc.)
• Self-inflicted injuries, suicide, or attempted suicide, regardless of mental state
• Drug overdose unless it was prescription medication taken as prescribed
• Death caused by the insured person's negligence (e.g. failure to wear a seatbelt)
• Death caused by extreme activities (e.g. bungee jumping)
• Death caused by murder committed by the beneficiary
• Death caused by natural causes
• Death caused by intoxication or under the influence of drugs or alcohol
• Death sustained while attempting or committing a felony
• Death that occurs during a medical procedure, surgery, or post-surgical recovery (not due to medical malpractice)

In addition, insurance companies may also deny a claim by manipulating policy language or claiming the death was not accidental. They may also deny a claim if the death falls under a policy exception, such as suicide, the insured person's negligence, intoxication, natural causes, or murder by a beneficiary.

Pros and cons of double indemnity life insurance

Double indemnity is a clause in a life insurance policy that stipulates that the beneficiary will receive a multiple of the face amount of the policy—commonly double—in the event of the policyholder's death by accidental means. This includes murder by someone other than the beneficiary and most accidental deaths. However, it excludes suicide, death by natural causes, gross negligence by the insured, and high-risk activities.

Pros of Double Indemnity Life Insurance:

• Provides double the death benefit for accidental death, which can offer additional financial support for beneficiaries and help maintain their living standards.
• May cover accidental deaths that could be linked to wrongful death suits.
• Can be combined with accidental injury riders, providing a financial benefit if the insured becomes seriously injured and unable to work.

Cons of Double Indemnity Life Insurance:

• Higher premiums compared to standard policies.
• A complex claims process that requires extensive documentation, such as police reports, coroner's reports, and eyewitness statements.
• Numerous exclusions, such as death by negligence, suicide, or natural causes.
• May not be available for high-risk individuals, such as those in dangerous occupations or extreme sports.
• Not all accidental deaths qualify, and there may be limitations on certain types of vehicular accidents.

Frequently asked questions