An Accidental Death (AD) rider on a life insurance policy typically pays out in which of the following circumstances?

Question: An Accidental Death (AD) rider on a life insurance policy typically pays out in which of the following circumstances?

Answer options:

• When the insured dies of a terminal illness. ✅ When the insured dies as a direct result of an accident.
• When the insured is diagnosed with a critical illness.
• When the insured becomes totally disabled.

Correct answer: When the insured dies as a direct result of an accident.

Explanation: The primary purpose of a 'Double Indemnity' or Accidental Death benefit rider is to pay an additional sum if the death results solely from an accident. Disease or natural causes are excluded.