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Life Insurance Policy vs. Accidental Death Insurance Policy - Explained

Published On Jun 21, 2021 2:00 PM By InsuranceDekho

Even though a few death-related terms and conditions of a life insurance policy and an accidental death life insurance policy are similar, the purpose of both the policies makes them quite different from each other. Read on to know about them in detail.

What is a Life Insurance Policy?

A life insurance policy offers a life protection cover to the policyholder through its different kinds of plans. Many additional benefits are granted according to the personal and distinct needs of the life assured. Here are the types of life insurance policies. 

  • Whole Life Insurance Policy - Under this, the life assured is provided with life cover for his entire life, even if he lives up to the age of 100 years. The policyholder receives a maturity benefit after the policy duration. If the life assured dies before the term ends, the beneficiary or the nominee would be provided with death benefits.
  • Term Life Insurance Policy - Under this, life insurance is provided with life cover for a specific duration. The beneficiary receives death benefits after the policyholder’s death. Unlike whole life insurance policies, there are no maturity benefits. 
  • Endowment Policy -  Under this, a dual advantage of a life cover and savings are received by the life assured. According to this plan, the policyholder or the nominee will enjoy maturity benefits after the policy term ends. However, if the life assured dies within the policy duration, the beneficiary will be paid a sum assured along with some bonus evaluated through the years the life assured lived.
  • Money Back Policy - Under this, a percentage of sum assured at uniform intervals within the policy term-end is enjoyed by the policyholder. Furthermore, the remaining amount from the aggregate and the accumulated bonus on the plan's maturity is received by the life assured if he/she survives after the term-end. However, the nominee will be provided with the entire sum assured, overlooking the previously paid instalments, if the life assured passes away within the policy term.
  • Retirement Plan - Under this, the policyholder enjoys regular pension benefits during the vesting period, which helps attain financial stability and paves the way to income generation even after the life assured’s retirement. However, the beneficiary is provided with death benefits If the policyholder dies within the policy duration.
  • Children’s Life Insurance Policy - Under this, a parent can purchase a life insurance policy during childbirth which can be withdrawn when the child becomes an adult. This policy provides financial security to the children for their future goals like higher education, marriage etc.

You may also like to read:- Term Insurance vs Whole Life Insurance: Which One You Should Buy?

What is an Accidental Death Insurance Policy?

The policy provides financial protection against any accident wherein the policyholder suffers serious injuries, blindness, loss of a limb, paralysis. In case the life assured dies, the death benefit is paid to his/her beneficiary. As the policy only provides accidental death cover, the payable premium is less than a standard life insurance policy. Moreover, the life assured does not have to go under any proper medical examination to avail the accidental death insurance policy.

Difference Between a Life Insurance Policy and an Accidental Death Insurance Policy

Here are some points of difference between a life insurance policy or an accidental death insurance policy.

  • Coverage - A life insurance plan covers all causes of deaths except childbirth, suicide or death during a war. In contrast, an accidental death insurance policy only provides coverage to fatalities caused due to unforeseen accidents.
  • Time of Death - A life insurance policy provides death benefit even if the life assured dies years after the diagnosis of a critical illness compared to the accidental death insurance, which can be availed if the life assured dies in the accident or within 180 days of its occurrence. 
  • Plan Options - The various plans mentioned above in the life insurance policy section can be purchased depending on the life assured’s needs. An accidental death benefit plan can be availed only for accident related circumstances.
  • Partial Benefits - The life assured does not get any benefits if he/she loses a limb or faces blindness due to an accident and does not have any additional rider plans. In contrast, an accidental death insurance policy provides benefits during such situations.

Also read - Permanent Life Insurance or Term Life Insurance -- All You Need To Know


It would be best to purchase a plan after going through all the terms and conditions of different policies. Furthermore, you can take advice from a financial advisor or an insurance agent to estimate an appropriate value of the sum assured and the policy tenure.

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