Personal Accident Insurance Cover Policy

  • Personal accident insurance covers individuals for accidental injuries, providing financial support for medical expenses, disability benefits, and related costs.
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What is Personal Accident Insurance?

what is Personal Accident Insurance

Personal Accident Insurance is a specific policy to build a safety net against any unexpected accidents that could otherwise lead to critical bodily injuries, partial or complete disability on a temporary or permanent scale, and accidental death. In case of accidental death, the insurer will offer coverage benefits to the nominated dependents (includes spouse, children, or parent).

The policy specifications mention that the insured policyholder is covered for unexpected accidents during travel through different modes such as road, rail, air, water, or even by a collision, leading to adverse physical injuries or loss of life. Several insurers provide personal accident cover as an add-on to health insurance policies with an additional premium.

Benefits of having Personal Accident Insurance Policy

benefits of Employee Dishonesty Insurance

A Personal accident insurance policy is designed to align with all age groups to support the insured policyholder during any unexpected accidental emergency. Let’s understand some benefits of PA cover as follows:

  • Comprehensive cover: The policy provides comprehensive coverage to support the insured with medical expenses, hospitalization, and a drop in income in the event of partial or complete on a temporary or permanent level or loss of life due to an accidental emergency.

  • Financial protection: The Personal Accident Insurance Policy offers financial security with comprehensive coverage to ensure the insured and his/her dependents are protected from sudden expenses for medical treatment and have a safety net in case the insured loses his life or suffers through temporary or permanent disability.

  • Global coverage: The policy provides the insured global coverage against any accidental emergency while traveling by road, rail, water, or air. This implies the insured will get the required coverage benefits during any unpredicted accidental emergency whether in India or abroad.

  • Daily cash benefit: The insured will receive a daily cash allowance as per the sum assured to support the day-to-day expenses during hospitalization with the specific coverage amount and the number of days varying according to the nature of the policy.

  • Support for dependent children: The policy coverage provides a safety net to the insured’s dependent children from any unprecedented accident causing loss of livelihood due to hospitalization, disability, or death.

  • Tax benefits: According to the Income Tax Act regulations, the policyholder can claim tax benefits for the policy premium paid for Personal Accident cover under Section 80D.

What’s Included in Personal Accident Insurance Coverage?

What's included

The personal accident insurance cover is a safety net for the insured and his/her beneficiaries. Let’s understand the coverage inclusions here:

  • Accidental death coverage: On accidental death, the personal accident cover provides death benefits to the insured’s dependents, which includes immediate family members such as spouses, children, parents, or any nominated legal heir. The death benefits consist of 100% of the sum insured along with support for dependent children and funeral expenses based on the policy and add-ons selected.

  • Permanent disability: The insured receives the sum assured when an unexpected accident causes partial or complete permanent disability. However, the coverage benefits vary according to the extent of partial or complete disability. In the case of partial permanent disability, the insured receives a specific percentage of the sum assured (up to 100%) based on the severity of the situation.

  • Temporary disability: The insurer offers a weekly allowance under personal accident insurance when the insured encounters an accident and experiences total disability temporarily. This helps manage the day-to-day expenses and compensates for the loss of income to continue the timely payment of EMIs or other fixed expenses.

  • Hospitalization costs: The policy coverage includes medical treatment and hospitalization costs when the policyholder suffers severe injuries due to accidents.

  • Loss of income: When the accidental emergency causes severe injuries or disability causing the insured to lose the means of livelihood, the personal accident cover compensates for the loss of income to support the daily requirements.

  • Hospital daily allowance: The insured receives a fixed allowance daily based on the amount insured to cover the regular needs amid ongoing medical treatment depending on the coverage amount and the number of days in hospitalization varying according to the policy details. Several insurers provide ₹ 1000 for 30 days during hospitalization.

  • Add-on cover for children’s education: The policyholder can opt for an add-on cover to protect the children’s educational needs by paying an additional premium. This supports the dependent children during any unpredicted accidents causing death or permanent disability of the insured.

  • Add-on cover for funeral expenses: The insured can opt for an add-on cover to manage the funeral expenses by paying an additional premium amount in the event of a sudden accidental death.

What’s not Covered? under under Personal Accident Insurance Coverage?

What's not included

Personal accident insurance coverage supports the insured and his/her nominees during any unprecedented emergencies. However, there are some conditions when personal accident insurance will not provide any coverage. Let’s uncover the exclusions here:

  • Natural Death: The personal insurance cover does not include death caused by natural causes such as cardiovascular diseases, respiratory diseases, cancer, infectious diseases, etc.

  • Intentional self-harm or suicide: When the insured intentionally causes injury to self or commits suicide, the policy does not provide any cover for it.

  • Pre-existing conditions of disability or injury: When the insured policyholder has any pre-existing condition of disability or severe injury, the policy excludes any coverage to support the insured’s livelihood.

  • Pregnancy and childbirth: The personal accident cover does not include any claims as a result of complications due to pregnancy or injuries amid childbirth.

  • Injury inflicted by adventure sports: When the insured suffers due to injury caused by taking part in adventure sports such as sky-diving, bungee jumping, or other high-risk activities leading to any unexpected accident, the policy does not provide any coverage for it.

  • Accident under the influence of intoxicating substances: For any claims on accident cover when the insured was under the influence of intoxicating substances such as alcohol or illegal drugs, then the insurer will reject the claims.

  • Medical expenses for treating other ailments: The personal accident cover will exclude any expenses for medical treatment of any other illness or injuries which are not caused due to the accident.

  • War or terrorism: Any event of death or injury due to activities of civil or political unrest, war, or vandalism will not be covered under the policy.

What does a Personal Accident Insurance Cover Policy cost?

Typically, the cost of Personal Accident insurance depends on the occupation of the insured. The coverage limit should be about 10 times the annual income of the insured. This provides the required safety net for the dependents and will cover income loss, medical treatment, and personal requirements.

The occupational risks are classified into three segments under personal accident insurance which are as follows:

  • Low-Risk or Class 1: This consists of professionals who have minimum risk factors such as accountants, doctors, lawyers, teachers, bankers, administrative or managing professionals, and architects.

  • High-Risk or Class 2: This category consists of professionals who are susceptible to injuries. The category consists of builders, contractors, manual operators, garage mechanics, veterinary doctors, and employees traveling with cash.

  • Very High Risk or Class 3: The very-high risk category consists of professionals who are easily vulnerable to accidents. This includes journalists, mine workers, big game hunters, professional river rafters, circus performers, people based in explosive industries, mountaineers, etc.

Alongside the type of occupation, the other factors that influence the premium price are the age and health status of the applicant.

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Frequently Asked Questions

Is it worth having a Personal Accident Cover? faqs-arrow
Personal Accident cover provides the required financial support for any medical expenses in hospitalization and treatment for an accidental injury. Furthermore, the policy also has coverage for partial or complete disability and provides a lump sum to the dependents on death. So, it is worth having a personal accident cover.
How Much Personal Accidental Insurance Coverage is Enough? faqs-arrow
When purchasing Personal accidental insurance, the coverage amount should ideally be 10 times more than the annual income of the policyholder. This is roughly estimated but can be more considering several factors like the number of dependents, any mortgages or loans, lifestyle and nature of employment, and future expenses.
Difference Between Personal Accident Insurance and Life Insurance? arrowbtn
Personal Accident Insurance provides cover when the insured suffers injuries or loss of life only due to the accident. Further, the policy provides coverage for medical treatment and hospitalization and offers a lumpsum amount when the insured suffers through partial/complete temporary or complete disability. On the other hand, Life Insurance provides cover for a specific time pre-decided during the onset of the policy. Life insurance provides the covered amount after the maturity of the policy. In the event of the death of the insured, the covered amount goes to the nominee.
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