What is accidental death benefit on my life insurance plan ?
With the majority of life insurance policies they offer a small added extra whilst the policy is being underwritten. Before explaining accidental death cover it is important that you understand what the process is for underwriting a life insurance plan. The first part of the plan is to collect the underwriting information, this is normally done in the form of a paper based application form. Once the information has been collated on the form it is passed to the chosen insurance provider. This is normally done via an electronic submission via the internet or some of the providers who are not quite so technically advanded need the paper application form sending directly to them.
Once the application is recieved by the provider it then has to be underwritten, the underwriting process can take a number of days, weeks or even months. This is dependent on the doctors normally and how quickly they respond to the requests of the insurance provider. It is during this period that accidental death benefit would come into place. The accidental death benefit would normally pay the lower of the amount of cover applied for or a lump sum of £300,000.
This is seen a little bit like a goodwill gesture from the company and if the underwriting process is taking longer than expected this gives a bit of peace of mind.
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