What Is A Double Indemnity Clause For Low Cost Life Insurance?

Most people have some type of life insurance policy and even if they have gone through the policy once or twice they haven’t really read through and may not understand it, or may have opted not to get double indemnity when they don’t even know what it means.

Receive Double Benefits with Double Indemnity

A double indemnity clause means that there is an additional payment which is usually the same amount as the insurance policy.

In other words, if the beneficiary dies, and this clause applies then the beneficiaries usually get double the amount.

The indemnity clause goes into effect when the policy holder dies in an accident. This is called double indemnity or accidental death benefit.

Exception to Double Indemnity Clauses

Of course there are exceptions that apply to the double indemnity clause. Insurance providers will not pay if the death has been ruled a crime, or a suicide.

Other reasons an insurance provider may not pay indemnity benefits is if the policy owner died from a natural cause and this caused an accident.

An example of this is someone who has a heart attack and then has an accident. In this case the insurance policy will pay the normal face value but not the indemnity.

Revise Your Insurance Policy Periodically

Many insurance policies are sold without indemnity clauses, this is why you should ask for the clause to be included, and it can be added even to the lowest cost life insurance policy. There is an additional cost in carrying indemnity insurance but it is not a significant one.

Additional indemnity insurance is something an insurance policy owner would be wise to add to his current insurance policy.

This is just one more reason why it is important to go over the insurance policy in place every once in a while and talk to your insurance provider about different options.