New Jersey Life and Health State Practice Exam

What benefit does a double indemnity rider provide in the event of an insured's death?

1. Death from natural causes

2. Death from an accident

3. Death after a long illness

4. Any cause of death

The correct answer is: Death from an accident

A double indemnity rider is a provision added to a life insurance policy that essentially doubles the death benefit if the insured dies as a result of an accident. This means that in the unfortunate event of an accidental death, the beneficiary would receive twice the policy's face value, providing enhanced financial protection. This rider does not typically apply to deaths resulting from natural causes, long illnesses, or other non-accidental circumstances, which is why the specific focus on accidental death is crucial in understanding its function. This benefit is particularly attractive for those in high-risk occupations or activities, as it offers additional peace of mind.