Accidents are unpredictable and can bring with them life-altering consequences. It is, therefore, very important for families to be financially secure. Among the most reliable ways of securing one’s loved ones in Canada is Term Life Insurance. Many Term Life Insurance Policies offer optional accidental death benefits, which provide an additional layer of security against unforeseen events.
This guide provides you with all that you want to know about incidental benefits in term insurance:
- How they work.
- Why they are important.
- What are some considerations to consider when making your Term Life Insurance selection in Canada?
Naturally, as the process is carried out along the way, we will come to terms with life insurance quotes, roles for Term Life Insurance Brokers, and the proper choice of your Canadian term life providers.
What Are Accidental Benefits in Term Insurance?
Accidental benefits, also known as Accidental Death Benefits (ADB), are additional payments made to beneficiaries in case the policyholder dies from an accident. This is generally offered as a rider, which can be added to your Term Life Insurance Policy for an extra premium.
For example, buy a Term Life Insurance Policy in Canada for a $500,000 death benefit and an accidental death benefit rider that adds another $250,000. Your beneficiaries will receive the sum of $750,000 in case of an accidental death.
Why Are Accidental Benefits Important?
- Better Financial Security: Accidents can leave unexpected financial setbacks. Adding accidental benefits to your Term Life Insurance will give your loved ones more money to overcome these setbacks.
- Low Cost of Cover: Accidental benefits are cheaper to add to your Term Life Insurance Policy than purchasing separate accident insurance policies.
- Peace of Mind: You will have the peace of mind of knowing that your loved ones will receive extra financial support in case a tragic accident occurs.
- Customized Coverage: You can select an accidental benefit that may best suit your family’s current and future financial needs.
How Do Accidental Benefits Work in Canadian Term Life Insurance?
Accidental benefits in Term Life Insurance become active if the policyholder dies as a result of an accident. The terms can be different for each Term Life Insurance company, but generally, it works like this:
- Definition of Accidental Death: The death has to be a direct result of an accident, for example, a car crash or injury at work. Natural causes or illnesses do not cause it.
- Exclusions: Most Term Life Insurance Policies exclude deaths due to risky activities (e.g., skydiving) or illegal activities.
- How To File A Claim: Proof of the accident must be provided by the beneficiaries, including police reports or medical documents, to the insurer in order to claim the accidental death benefit.
Key Features of Accidental Benefits in Term Life Insurance Canada
- Additional Pay-Out: Accidental death benefit is payable along with the basic death benefit of the Term Life Insurance Policy.
- Personalized Amounts: You can choose the amount of accidental coverage according to your objectives and the premium you want to pay.
- Availability Under Policies: Most Canadian Term Life Insurance companies offer accidental benefits as riders under their Term Life Insurance Policies.
- Guaranteed Premiums: The cost of accidental benefit riders typically stays flat through the term of the policy.
Who Should Consider Adding Accidental Benefits?
Accidental benefits are very helpful for:
- Young Policyholders: Young people with dependents will benefit from extra cover without significantly increasing their premiums.
- Main Breadwinners: If your family depends on your income, accidental benefits mean there is always extra financial protection in case of a sudden accident.
- Dangerous Occupations: Those who work in hazardous conditions, such as construction or transport, may find accidental benefits particularly valuable.
How to Choose the Right Term Life Insurance Plan with Accidental Benefits
When selecting a Term Life Insurance Plan with accidental benefits, consider the following:
- Compare Term Life Insurance Quotes: Get Term Life Insurance Quotes from multiple providers to find a plan that offers affordable premiums with the best accidental benefit options.
- Review the Terms: Understand the specific conditions and exclusions of the accidental benefit rider.
- Consult Term Life Insurance Brokers: You can seek the help of experienced Term Life Insurance Brokers who can guide you through the intricacies of policies and help you choose the right coverage for your needs.
- Assess the Credibility of the Provider: Select Term Life Insurance Providers in Canada that are known for transparent terms and reliable customer service.
Advantages of Adding Accidental Benefits to Term Life Insurance Policies
- Financial Security: Accidental benefits help provide an extra layer of financial protection for your loved ones during a difficult time.
- Budget-Friendly Premiums: Attaching accidental death riders to your policy is often cheaper than buying a separate accident insurance policy.
- Options Galore: Many Canadian Term Life Insurance companies give you the option to opt for a variable accidental coverage amount.
- Simplified Claim Process: Accidental benefit insurance companies have made it easy to file claims.
Limitations of Accidental Benefits
Accidental benefits provide increased cover but need to be known through their limitations:
- Specific Cover: Accidental death coverage covers only accidents but not illness-related or natural causes.
- Exclusions: Any death caused through hazardous activities or by drugs/alcohol is usually excluded.
- Add-on Cost: Though relatively inexpensive, accidental benefits add to the total premium cost of your Term Life Insurance Policy.
How to Add Accidental Benefits to Your Term Life Insurance Policy
- Choose an Appropriate Term Life Insurance Plan: First, you have to choose a Term Life Insurance Plan that will satisfy your minimum coverage requirements.
- Rider Option: During the time of buying or renewing your policy, add the accidental benefit rider.
- Terms and Conditions:
- Know the cost, the limits of coverage, and the exclusions of the rider.
- Consult Your Broker: You should consult with Term Life Insurance Brokers to be sure of your decision.
Top Canadian Term Life Insurance Providers Offering Accidental Benefits
Here are some reputable Canadian Term Life Insurance Providers that offer accidental benefits as part of their term policies:
- Sun Life Financial
- Manulife
- Canada Life
- RBC Insurance
- BMO Insurance
Each provider offers unique terms, so it’s essential to compare Term Life Insurance Quotes and understand the differences before making a choice.
Accidental Benefits vs. Standalone Accident Insurance
| Feature | Accidental Benefits in Term Life Insurance | Standalone Accident Insurance |
| Cost | Lower premiums | Higher premiums |
| Coverage | Add-on to term life policies | Covers only accidents |
| Payout | Additional benefit on top of death benefit | Lump sum for accident-related losses |
| Flexibility | Part of existing policy | Separate policy |
Adding accidental benefits to your Term Life Insurance Policy is generally more cost-effective than purchasing standalone accident insurance.
Steps to Compare Term Life Insurance Quotes Online
- Use Online Tools: Many companies offer free calculators to make comparisons on quotes for Term Life Insurance and online rider options.
- Use the correct details: The accuracy in the provided details concerning age, health, and lifestyle can help achieve realistic quotes.
- Check riders: Quote comparisons must include riders, such as accidental benefits or other options.
- Reviews: Look up reviews regarding the claims handling process and the company’s customer service.
Conclusion: Accidental Benefits as a Safety Net
Accidental benefits in Term Life Insurance can be an affordable and practical way to increase your family’s financial protection. With the right Term Life Insurance Plan, experienced Term Life Insurance Brokers, and online Term Life Insurance Quotes, you can create a safety net for your loved ones.
If you’re purchasing term insurance or wish to upgrade your term coverage, add accidental benefits in an attempt to make more steps forward for a secure, more confident financial future. Take a step towards availing coverage through reputable Canadian Term Life Insurance companies.
KNOW MORE: What Is a Long Term Life Insurance Policy?