Navigating the Unexpected: Guide to Personal Accident Insurance
3 min read
・Jul 30, 2024
Introduction: India’s Accident Landscape
India has been susceptible to various road crashes and accidents. In line with the Ministry of Road Transport and Highways of India facts, there were 4.12 lakh crashes on roads in India in 2021. From this:
- Around 37 per cent of individuals died accidentally, and 63 per cent were injured.
- According to the survey, the age bracket most impacted is 18 to 45 years old.
Don’t you think you need protection from such terrible mishaps? Personal accident insurance can be your rescuer. Let’s read about it.
What is Personal Accident Insurance?
Personal Accident Insurance is a financial policy that covers unfortunate incidents. Such events must be the result of air, rail, or road collisions, accidents, or explosions.
This coverage offers protection from the possibility of death, wounds, disabilities (permanent as well as temporary), and income losses that befall due to accidents.
Types of Personal Accident Insurance
Individual Personal Accident Insurance:
It’s the popular kind of coverage under the personal accident category. Individual Personal Accident Insurance comes into action when the insured decides to insure themselves from uninvited accidents. This premium covers:
- accidental death
- blindness
- loss of limbs
- other permanent impairments
Group Personal Accident Insurance:
This category of insurance is for those that share a commonality, be it their occupation or the location. The heads of companies usually use them to provide insurance coverage for their workers. Based on the team’s size, insurance companies often offer discounts. However, compared to the individual scheme, this is a basic plan with fewer advantages.
Who should have Personal Accident Insurance?
- Whose line of work carries significant risk and constantly hunting for multiple health insurance types to safeguard their family.
- Anyone over the age of 18. On average, the highest age for applying is 65. This age, nevertheless, varies depending on the insurers. Additionally, it may range from 5 to 65 years for certain providers.
Pros of having Personal Accident Insurance
- Coverage of all hospitalisation expenses
- Coverage of demise or impairments due to burns or any accidents
- Global coverage for accidents means you are covered with any injuries you may sustain in an accident, even when you are travelling overseas.
Coverage under Personal Accident Insurance
Accidental Death:
A personal accident policy usually offers compensation in tragic cases that result in the policyholder’s demise. The reason for such misfortunes must be an accident. Some of those mishaps include vehicle crashes, falls, and other unplanned events that end in fatalities.
Permanent Total Disability:
There are certain scenarios when the insured is permanently and completely disabled due to the accident. Here, the Personal Accident Insurance Policy offers a certain amount of money to help with the costs of living and medical care.
Permanent Partial Disability:
The health insurance benefits are that it pays if the insured suffers from a permanent partial disability, like arm/leg deprivation or partial paralysis. The coverage can also provide a lump-sum payment depending on the impairment’s severity.
Temporary Total Disability:
Should the policyholder suffer from temporary complete disability and become bedridden, the insurance company will offer a weekly stipend to offset the loss of earnings. If income decreases, the insured may also utilise this claim money to settle the EMIs.
Difference Between Personal Accident, Health Insurance, and Life Insurance
| Basis | Personal Accident Insurance | Health Insurance | Life Insurance |
| Coverage | Accidental Death, Injuries/ Disability | Sickness, Medical Expenditures | Death up to the chosen tenure |
| Purpose | Financial Protection against Accidents | Healthcare Expenses Reimbursement | Financial Safety for Self and Family |
| Benefits | Death, permanent partial or total disability, and temporary total disability. | Reimbursement or Cashless Hospitalisation (Pre and Post Charges) | Death Benefit to Beneficiaries |
| Exclusions | Pre-existing Conditions, Self-Inflicted Injuries | Pre-existing Conditions, Lifestyle Diseases | Suicide Clause, Fraudulent Claims |
How much coverage of personal accidents is needed?
Deciding on the right coverage amount to purchase Personal Accident Insurance depends on several factors, including job, lifestyle, and obligations to the financial sector. Vehicle owners are compulsorily required to have an accident cover of INR 15 lakhs in their car and bike policy. Failing to have a personal accident cover can result in fines based on the Motor Tariff, 2002 provisions.
Key Takeaways
Personal accident insurance acts as an essential shield from life uncertainties for policyholders and their loved ones. If you are aware of its importance, its various kinds, and ample coverage, you can confidently rely on it for protection from any unexpected consequences of an accident. For an easy and convenient purchase of personal accident insurance, consider using platforms like PhonePe, ensuring you and your loved ones are always protected.
