Road accidents claim one life every four minutes in India. The number of injured people is about four times this number. Personal accident insurance, also called PA policy protects you financially in such mishaps when you need the treatment first.
Read on to know why you must include personal accident insurance in your contingency planning kit.
What Is Personal Accident Insurance?
Accidents can cause not only death but multiple other complications as well. For example, numerous victims of road accidents often undergo a long period of hospitalisation. Many do survive, however, may suffer from a short-term or temporary loss of physical capacity. Few even end up disabled for life due to loss of a limb.
Thus accidents may not simply lead to one or the other losses, but could very easily combine multiple financial distresses:
- Emergency Hospitalization & Surgery
- Temporary disability of physical and mental capacity which affects income
- Permanent loss of limbs or eye-sight or hearing, which can alter the life of survivor and family forever
While, life insurance can only deal with death and health insurance may deal with hospital bills, PA policy offers to help you with all accident related risks.
What Does Personal Accident Plan Cover?
You must always acquaint yourself with the terms and conditions of the PA insurance policy that you plan to purchase. Most PA insurance covers:
| Hospital, Treatment & Conditions | Transport & Modifications |
|---|---|
| Permanent Total Disablement | Road Ambulance |
| Broken Bones | Air Ambulance |
| Permanent Partial Disablement | Family Transport Benefit |
| Burns | Modification of Residence/Vehicle |
| Head & Spinal Injury | Cost of Prosthetics |
| Coma | |
| Accidental Hospitalization | |
| Total Temporary Disablement |
The policy may offer additional benefits such as the following apart from the basic insurance benefits
- Accidental Out-patient Hospitalization
- Hospital Cash
- Transport of Imported Medicine
- Purchase of Blood
- Education Grant
What Does the Personal Accident Insurance Not Cover?
Generally, the following conditions are excluded from the personal accident insurance plan:
| Natural Death | Injuries while inside an aircraft |
| Pre-existing disability or injury | If injuries occur during climbing or dismounting from an aircraft which is not a licensed passenger aircraft |
| Self-injury or Suicide | Nuclear weapon related injuries |
| Injuries obtained while under influence of intoxicants | Injuries during a war, invasion, or any other kind of military action |
| Death/injury during adventure sports activities like bungee jumping, river rafting | Childbirth injuries |
Note: You will be mounting or dismounting from a passenger airline’s plane
Key Features of Accidental Insurance Plans
Few key features allow modern personal accident plans to act as an umbrella cover for the family. Safeguarding the family from any accident-related mishap which may turn costly. Few of the important features are given below:
- Customizable plans for family
- 24×7 Worldwide cover
- Inpatient and OPD expenses covered
- Hospital cash purchase of medicine and blood
- 100% Payout upon Death and disability
- Cumulative bonus on the sum assured for every year the policy runs without a claim
- Cover your child as young as 5 years of age
- Restoring of benefit amount after a partial claim, such as hospitalization or surgery
Why Should You Buy Personal Accident Insurance?
Accidents can bring forth numerous different challenges for you and your family. These challenges are not only physical but almost always financial as well. Loss of income whether short-term or long-term can severely interrupt the normal course of the family’s existence.
More importantly, these situations can affect your children’s future. Thus, you must invest in a good personal accident policy.
Given below are a few more reasons why anyone and everyone, whether single, married, with children or without, should have an active personal accident insurance cover all the time:
- Receive emergency medical care immediately after an accident
- Financial assistance to family and cover the loss of income due to accident
- Monetary support in case of a long term disability
- Children can continue their education without getting affected by the loss of income or employability
- Travel anywhere in the world with assurance that you are financially safe from accident induced emergencies
- Family can receive immediate financial assistance in case of death or injury
- Help in the transportation of the injured or dead body
How Does Personal Accident Cover Work?
Suhasini is a 30-year-old salaried woman who spends about 2 hours each day travelling from home to office. She also likes to go on weekend escapes to nearby places out of the city. Her preferred mode of transport is her own car.
Suhasini, whenever on the road takes every precaution to stay safe and drive without affecting other’s movement on the road. However, on one unlucky day, another driver rams her car from the side after losing control of his vehicle. The impact results in secondary movement of Suhasini’s car and she’s injured to the extent that she must be hospitalized.
Fortunately, she had a personal accident policy, which immediately comes into force.
What Will Suhasini’s PA Policy Do?
Here’s how it worked to put everyone at ease financially:
- The hospital admits Suhasini immediately without any immediate financial commitment. PA cover takes care of the medical expenses.
- Suhasini undergoes an emergency procedure without any cost to the family
- Suhasini may have to stay in the hospital for about three weeks. PA policy will take care of most of the hospitalization costs.
- The hospital Suhasini went to right after the accident was near the accident site but she needs to move to another hospital closer to her home. PA policy will bear the transportation cost (reimburse as per policy limits)
- She’ll receive a compensation amount for the time she’s been disabled completely. This amount is a percentage of the total benefit available under her PA policy
- Her two children will receive an education allowance for the period Sihasini’s bedridden (subject to policy limits)
- The policy will continue to cover her as the claim was partial, and the benefits will restore once she renews the policy.
Noone can predict accidents, and thus the name ‘accident’. However, you can be sure that a serious injury can derail your financial planning and put you and your family at risk. While human life and sufferings thus occurred due to accident can’t be measured in price, a personal accident insurance policy can help you ensure your financial security until you get back to work.
Personal Accident vs Life vs Health Insurance
For those who might feel that a good health plan and a life cover are enough, let’s compare the three options objectively. The following table should give you a fair idea of the gaps fulfilled by the personal accident cover.
The table shows the various benefits available to the policyholders of these policies:
| Benefit | Personal Accident | Health In. | Life In. |
|---|---|---|---|
| Death from natural causes | No | No | Yes |
| Death from illness or disease | No | No | Yes |
| Accidental Death | Yes | No | Yes |
| Partial disabilities | Yes | No | No |
| Hospital Expenses | Yes | Yes | No |
| Child Education Support | Yes | No | No |
| Tax Benefit | No | Yes | Yes |
Table shows the differences between the personal accident, health and life insurance plans
Use personal accident insurance cover and protect your loved ones from suffering financially if you happen to meet with an accident. Stop the moment of bad luck and misfortune from stalling the wellbeing of your family’s future.
References:
- Insuropedia – SecureNow
- Investor Corner – IRDAI
- How to Claim Personal Accident Cover Benefit – Live Mint
- Universal Sompo Personal Accident Policy Document – IRDAI
- MAGMA HDI Individual Personal Accident Policy Document – IRDAI
- Apollo Munich Individual Personal Accident Policy Wording – IRDAI
- OIC Individual Personal Accident Policy Wording – IRDAI