scorecardresearchPersonal accident insurance: Types of policies, coverage and everything else you need to know

Personal accident insurance: Types of policies, coverage and everything else you need to know

Updated: 11 Jan 2023, 01:16 PM IST
TL;DR.
A person should consider purchasing personal accident insurance to safeguard themself and family if their line of work entails significant dangers.
A personal accident insurance policy covers the loss of life, limb, or general disablement caused by an accident while traveling.

A personal accident insurance policy covers the loss of life, limb, or general disablement caused by an accident while traveling.

Accidents can result in different types of injuries, including those causing total or partial disability, which can have an impact on your ability to work and generate an income. 

In cases of accidents, a life insurance policy does not offer the necessary protection and a medical insurance would only pay for hospital expenses.

Accident insurance fills up for the ambiguous space that neither a life insurance policy nor a health insurance policy can fully cover. You need personal accident insurance to ensure you keep your family financially protected against unanticipated catastrophes like accidents.

What is a personal accident insurance policy?

A personal accident insurance policy covers the loss of life, limb, or general disablement caused by an accident while traveling. For those who travel regularly for work, personal accident insurance coverage is essential.

Both small and serious accidents are covered by personal accident insurance coverage. In addition to death, it also includes complete or partial disability. Additionally, it covers transitory impairments that might prevent you from working for a time period. 

Your basic insurance won't protect you against such temporary limitations, so you'll need to shell out a fortune for more costly coverage.

According to several experts, the personal accident insurance policy should cover 10 times your monthly salary. It is advised to get an accident policy for roughly 1 lakh if you, for instance, earn a monthly salary of 10,000. This will guarantee that you receive enough money to cover crucial costs like loan repayment, child care, etc.

What are the types of personal accident insurance policies?

  1. Individual accident cover- The majority of insurance providers provide fundamental accident coverage, which compensates the beneficiary in the case of the policyholder's demise or complete disability. Some insurance may cover temporary and partial disability too.
  2. Group accident cover- There are certain plans that allow the policyholder to get group coverage for the entire family. Employers typically provide group accident insurance plans to their employees since they receive these policies at a reduced premium based on the company's strength.

What are the benefits of personal accident insurance?

Any policyholder who is physically impaired and unable to work, whether partially or completely, may file a claim for accidental disability coverage. Total impairment may be temporary or permanent. A predetermined sum will be given to the policyholder in the event that an accident results in permanent incapacity. 

If the accident causes the insured permanent partial damage, they will get 100 percent of the sum assured.

If a policyholder passes away due to an accident, the nominee will receive payment of the policy's sum insured.

Under this policy, if an accident results in hospitalization, money is paid each day up to a certain maximum number of days. In addition, the expense of travel will be covered by personal accident insurance coverage if the hospital is far. The policyholder's immediate family members are eligible for this benefit.

Summing up

A person should consider purchasing personal accident insurance to safeguard themself and family if their line of work entails significant dangers.

Anybody who is older than 18 years can purchase the insurance. Typically, 65 years is the maximum admission age. 

It's crucial to remember that there are no tax deductions available with personal accident insurance. These policies are in place to make sure that policyholders may carry on with their regular activities without worrying about the costs associated with accidents that result in damage or death.

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First Published: 11 Jan 2023, 01:16 PM IST