Accident insurance and AD&D: what they pay and when
Accident insurance pays you cash after a covered injury. AD&D pays after a serious accident. Neither is car insurance or health insurance coverage.
Last checked October 18, 2026 · Written by licensed advisors · Sources are numbered and listed under Notes and sources
What is accident insurance?
Accident insurance pays you cash after a covered injury, such as a fall, a fracture or stitches. It pays a listed amount for each covered injury or treatment.
It is not health insurance coverage, and it is not car insurance.1
- Pays after a covered injury
- A listed amount, paid to you
- Injuries only, not illness
- Not car insurance
How does accident insurance work?
You choose a policy with a schedule of amounts. After a covered injury, you file a claim and the policy pays the listed amount to you.
You can use the money for the ER bill, your deductible or time off work. Your health plan still pays the medical bills under its own rules.1
- You are hurtA covered injury, like a broken wrist
- You get careER, treatment or follow-up
- You file a claimSend the policy’s paperwork
- You are paidThe listed amount, to you (key step)
What is accidental death and dismemberment (AD&D) insurance?
AD&D pays if an accident causes death, or the loss of a limb, sight or hearing. It pays a lump sum.
It pays only for accidents. It does not pay if you die of an illness, so it does not replace life insurance.12
Accident insurance vs AD&D: what is the difference?
Accident insurance pays for many everyday injuries, in smaller amounts. AD&D pays one larger amount after a serious accident.
Some policies bundle both. Read the list of what counts.2
- Pays after covered injuries
- Many smaller payments
- Fractures, stitches, ER visits
- Pays after a serious accident
- One lump sum
- Death or loss of a limb, sight or hearing
Is accident insurance worth it?
It can be worth a look if you work with your hands, drive for a living, or have active kids. Injuries are more likely in those situations.
It may not be worth it if you have savings to cover a deductible and time off work. It never replaces a health plan.
What to do: Tell us your work and your deductible. We suggest only what fits.
Does accident insurance pay for illness, or for a car accident?
No, it does not pay for illness. Illness is what hospital indemnity and critical illness are for.
It can pay you cash after a covered injury from a car accident. It does not repair the car or replace auto insurance.
Heads up: Accident insurance is not car insurance. After a car crash, your auto policy and your health plan still do the main work.
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Obamacare Hotline and/or Medicare Po Polsku are private companies not affiliated with any local, state, or federal government agency. This guide is general information, not tax or legal advice.