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Personal Accident Insurance Policy - Know Features and Benefits
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Why must you buy Personal Accident Insurance?

Accidents are becoming more common in this modern age, creating a lot of uncertainty. If you get caught in an unfortunate event, it can leave you with severe disabilities, even if it is a minor or major one. And even the most cautious person can be affected by accidents, which often have a significant impact on us, our families. Not only this, but it also leads to substantial medical expenses. Since health insurance policies do not cover accidental deaths and disabilities, personal accident policies act as the lifesaver in such cases. Here’s a detailed explanation of accident insurance and the reasons you should have it.

What is Personal Accident Insurance Cover? 

Personal accident insurance provides coverage for death or disability due to the involvement of the policyholder in an accident. In addition, the sum insured amount or the benefit amount is paid to the nominee in the event of the insured person’s death in that accident.

What are the different types of Personal Accident Insurance Policies in India?

Two types of personal accident insurance policy covers are available in the market nowadays, from which you may choose the one that fits your need and requirement:

  1. Individual Accident Insurance
  2. Group Accident Insurance

 

1. Individual Accident Insurance

This provides financial protection to the policyholder in the event of getting involved in an accident, leaving the insured person permanently or temporarily disabled. A lump sum payout is made to dependents in the event of accidental death.

2. Group Accident Insurance

These are generally offered by employers to provide financial security for the employees and their dependents in case of an accident. A Group Accident Insurance cover comes bundled with their job offer, and the premium for the same is usually deducted from the salaries. The amount of coverage varies according to the pay scale of the employee and their risk profile.

An insurance company offering personal accident cover that provides coverage for the following situations:

  • In the event of an accident resulting in death: A predetermined benefit amount (sum insured) is paid in a lump sum to the policyholder’s nominee for securing their future livelihood.
  • Permanent partial disablement: If the insured person is left partially disabled, i.e., If the insured person has lost an eye, an ear, or an index finger, they are considered permanently partial disabled. A certain percentage of the sum insured is paid to the policyholder according to the severity of the disability and as per the plan chosen.
  • Permanent total disablement: A permanent total disability is defined as a person losing one or both of their ears, both eyes, or one or both of their limbs in an accident. These are classified as extreme cases, and a suitable benefit amount is paid to the insured person for supporting their dependents.

 

How do personal accident insurance plans work?

While buying personal accident insurance, you are required to select a suitable coverage amount, called the sum insured, which is the value of your life. This amount should be chosen in such a way that it is sufficient to cover your family’s future needs in case anything happens to you in an accident. Also, you are required to pay a premium for the chosen policy regularly for utilizing these benefits.

You must notify your insurer immediately if you are involved in an accident that results in disability or dismemberment. If a road collision or any crime caused the accident, you would need to file a police complaint before moving to the next step of filing the claim form. It is required for you to provide all documents regarding the accident and hospitalization to your insurance company for the claim processing.

In case of death of the policyholder due to an accident, the nominee or legal heir of a policyholder should notify the insurer and must submit the claim form, death certificate, and any other relevant information and document. Once the verification is complete, the insurance company shall make the claim settlement by crediting the benefit amount or sum assured to the nominee’s account.

Benefits of a Personal Accident Insurance Policy

The features mentioned above are the main benefits offered by most insurance companies for personal accident coverage plans. However, there are some additional benefits that one can avail through these policies, such as:

  • Funeral Expenses: If the insured person dies due to an accident, their family can receive reimbursement for funeral expenses up to a certain amount of the assured sum.
  • Temporary Total Disablement: A specific percentage of the sum assured is paid to the insured person who has suffered total disability for a particular period to help them support their family and livelihood.
  • Child Education Benefits: If the insured person is permanently disabled or passes away due to an accident, a fixed amount is payable regularly to cover their child’s education.

 

What isn’t covered by personal accident insurance?

Like regular insurance policies, personal accident policies also have exclusions. An injury or disability that is caused by self-harm, mental instability, and/or pre-existing conditions. The policy does not cover the following types of claims if raised by the policyholder.

  1. Suicide attempt or self-inflicted injuries
  2. Involvement in criminal acts can result in injuries
  3. Adventure sports can lead to injuries
  4. Accidents that occur when you are under the influence of drugs, alcohol, and/or other hallucinogens
  5. Accidents sustained while engaged in defense-related operations
  6. Accidents caused by war, rebellion, mutiny, or other perils
  7. Pregnancy, maternity, and childbirth expenses
  8. All types of nuclear contamination-related accidents
  9. HIV/AIDS, and other venereal diseases
  10. Accidents caused by mental disorders
  11. Non-allopathic medical treatment
  12. Any other type of pre-existing disability

 

Considering the high uncertainty in the world, getting yourself a personal accident policy is the need of the hour. In addition to term insurance and health insurance policies, accident coverage is also required to address specific issues related to accident effects. With the advent of the internet, it is now possible for you to make a personal accident insurance policy comparison and then opt for the right policy cover.

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