Written by Henry Smith · Reviewed by Smiths Insurance & KiwiSaver — licensed Financial Advice Provider (FSP712931) · Last updated 2026-10-20

Accidental death cover compared with life insurance

Accidental death cover pays a benefit only if death results from an accident. Life insurance pays on death from illness as well as accidents, subject to the policy's early-years limits and exclusions. In New Zealand, ACC separately provides funeral and survivor payments when a death comes from a covered injury, but nothing for death from illness.

Get a quote and apply online today

See your price in about a minute, then apply online with Momentum Life. Guaranteed acceptance, no health questions, no medical exams.

Life cover See your price Ages 18–65 · $50k–$300k Funeral cover See your price Ages 40–75 · $3k–$30k

Want more than $300k or have questions? Talk to an adviser

Life cover: Conditions you already have aren't covered for the first 2 years (premiums refunded instead). Suicide isn't covered for the first 2 years, and a few conditions can be excluded permanently.

Funeral cover: Only accidental death is covered for the first 2 years. Total premiums can add up to more than the cover, and it may not meet the whole cost of a funeral.

Insurer: Momentum Life Limited. Financial strength rating B (Fair) from AM Best, affirmed 11 February 2026; B ratings sit in AM Best's 'vulnerable' range. The rating scale is available for inspection at every Momentum Life office in New Zealand. What this means

Already have cover? Keep it. New cover won't pay for a condition you already have in its first 2 years.

Opens Momentum Life's online application; its guidance only covers eligibility. QuoteHub is a Momentum Life partner. Smiths Insurance & KiwiSaver may receive a commission if you buy. General information, not advice.

In short

A policy that pays for death "from any cause" includes accidents. Accident-only cover pays for far fewer deaths, and nothing for illness.
Some life policies still have limits on accidents: Quick Life never pays for deaths from listed events such as war, terrorism or criminal activity, or from a dangerous job or pastime listed in its wording.
Momentum Funeral Insurance pays three times the benefit for accidental death, at any time, and pays only for accidental death in its first 24 months.
The benefit and the limits differ between products, so compare wordings rather than names.

What each type of cover is

Life insurance is cover that pays a lump sum when the insured person dies, from a cause the policy covers. Death from illness and from accident are both usually included.

Accidental death cover pays only when an accident is the cause. AIA's standalone Accidental Death cover is an example: ages 16 to 60, up to $500,000, expiring at 65 (AIA).

The difference is the question the insurer asks. For life cover the question is whether the death fits the policy; for accident cover the further question is whether an accident caused it.

What counts as an accident

Wordings define it narrowly, so read them:

Momentum Funeral Insurance: an accident is unintentional, violent, external and visible means that directly and solely cause death, and is not self-inflicted (Momentum Life: Funeral Insurance Policy Wording). Death must happen within 90 days of the accident.
Quick Life: an accident is an event that causes a fatal injury that is "unintended, unexpected and not self-inflicted", without any other contributing causes, and accidental death must follow within 90 days (Momentum Life: Quick Life Insurance Policy Wording).

The "no other contributing causes" and "solely" words matter: a death where illness played a part may not be an accidental death under a strict definition. That is a reason to check how the insurer defines it before you rely on accident-only cover.

Does life insurance not cover accidental death?

Normally it does. Two points where it may not:

Early-years restrictions. Quick Life covers accidental death from the start, and excludes pre-existing conditions and suicide for the first 2 years.
Listed exclusions. Quick Life does not pay for deaths caused by alcohol or drug effects (unless a prescribed drug was taken as directed), war, insurrection, terrorism, criminal activity, or a dangerous job or pastime in its wording: handling explosives or weapons, working 40 metres underwater, driving or riding faster than 130 km/h, professional sport, active armed-forces duty. Occupation and pastime are not asked at application, so they matter at claim time.

Other insurers set their own lists. See our page on life insurance exclusions and the broader comparison of life cover and life insurance.

Side by side

	Standard life insurance	Standalone accidental death	Momentum Funeral Insurance	Momentum Quick Life
Pays for accident	Yes, within exclusions	Yes	Yes, three times the benefit, from the start	Yes, from the start
Pays for illness	Yes	No	After 24 months	After the first 2 years for pre-existing conditions; new conditions from the start
Entry age	Insurer sets it	AIA: 16 to 60, expires at 65	40 to 75	18 to 65
Amount	Insurer sets it	AIA: up to $500,000	$3,000 to $30,000	$50,000 to $300,000
Health questions	Yes, usually	Check the insurer	None	None

AIA's figures are from its life insurance page, and the other columns are from the Momentum wordings. We did not find whether AIA asks health questions for its standalone accident cover, so check that with the insurer.

How Momentum's Funeral Insurance treats accidents

Funeral Insurance is guaranteed acceptance cover for ages 40 to 75, with benefits from $3,000 to $30,000. It has two rules that interact:

Accidental death pays three times the benefit, at any time, where death happens within 90 days of the accident. A $10,000 benefit pays $30,000, and a $30,000 benefit pays $90,000. The multiple is not limited to the first 24 months.
The first 24 months pay only for accidental death. If the person dies of anything else in that window, no benefit is paid and all premiums for that person are refunded. After 24 months, death from any cause is covered.

There is no terminal illness benefit and no separate suicide clause. Increasing cover starts a new 24-month window for the increase.

Total premiums can end up larger than the benefit, and the benefit may not cover the whole funeral. See how funeral insurance works, and the Funeral Cover page for the plan. There is also a guide to accidental death on funeral insurance.

How Quick Life treats accidents

Quick Life is guaranteed acceptance life cover for ages 18 to 65. Its first 2 years work as a two-stage cover: accidental death and new conditions that arise after the policy starts are covered, while pre-existing conditions and suicide are not. If a person dies from a pre-existing condition in the first 24 months and no claim is payable, premiums are refunded. Accidental death pays the same benefit as any other cause; we found no multiple in the wording. See Quick Life for the plan details.

What ACC adds

ACC is separate from private insurance. For deaths from a covered injury, ACC says it pays a funeral grant of up to $8,236.40 (the amount is set by the date of death), a survivor's grant of $8,830.47 to a partner and $4,415.25 for each child under 18 or dependant, and may pay loss-of-income support of up to 80% (ACC: Financial support after a death). It covers only deaths from covered injuries. For deaths from illness, ACC pays nothing, which is the gap that life insurance fills. Our page on ACC versus private insurance explains the interplay in more detail.

Choosing between them

There is no single right answer, and this is general information, not advice.

If you want protection against death from any cause, life cover is the wider product.
Accident-only cover is narrower and, in AIA's case, ends at 65.
If you are 40 to 75 and cannot easily get underwritten cover, Funeral Insurance accepts without health questions but restricts the first 24 months.
A healthy person can often get more cover for less with fully underwritten cover through an adviser.

Momentum Life Limited's A.M. Best financial strength rating is B (Fair); see its financial strength page. The buttons on this page open Momentum's online application. Advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a Momentum Life partner, and Smiths Insurance & KiwiSaver may receive a commission if you buy through our link; see how we are paid.

Frequently asked questions

Is accidental death covered by life insurance?

Usually yes, unless an exclusion applies. For example, Quick Life excludes deaths caused by listed events and by dangerous jobs or pastimes in its wording.

Does life insurance pay if death is not an accident?

Yes, that is the main difference. Accident-only cover pays only for accidents.

Does Momentum Funeral Insurance pay more for an accident?

Yes. Accidental death pays three times the benefit where death occurs within 90 days of the accident.

Is accidental death and dismemberment cover sold in New Zealand?

The two Momentum wordings read for this page pay on death (and, for Quick Life, terminal illness), not for injury alone. Momentum's claims page does list an Accidental Serious Injury form, so check the product you are looking at. ACC covers injury separately.

References

Momentum Life: Funeral Insurance Policy Wording (17 August 2023), retrieved 17 October 2026
Momentum Life: Quick Life Insurance Policy Wording (November 2025), retrieved 17 October 2026
Momentum Life: Financial strength, retrieved 20 October 2026
Momentum Life: Claims, retrieved 20 October 2026
AIA: Life insurance, retrieved 20 October 2026
ACC: Financial support after a death, page last published 22 July 2026, retrieved 20 October 2026