Personal Accident Insurance in India

Personal Accident Insurance in India

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Life is unpredictable; we do not know what will happen in the next moment. The problem does not knock; it can come anytime, anywhere; it could be minor or severe. Daily we meet with a lot of unseen circumstances and we never know about our future. To protect our future, we are purchasing insurance. It could be Life Insurance, Health Insurance, Vehicle Insurance, Home Insurance, etc. But have you ever think that if someone met with an accident and if he or she is total or partial disabled then how he/she will survive. Who will take care of them; who will pay the expense of hospital and medical charges? To mitigate all these problems, insurance companies provide one more plan called “Personal Accident Insurance Plan”.

Personal Accident Insurance Plan is something that provides for an accidental death benefit, disabilities (total or partial) and the expenses of hospitalization, transportation of patient & family and repair of vehicle or residence. Personal Accident Insurance will ensure financial stability for you and your family in the event of an accident. In the case of accidental death of the policyholder, the nominee gets 100% compensation from the insurer.

We all are going out either for school, for office, for pleasure or for any reason, we all carry risk. Personal Accident Insurance makes sure that you are covered not only for medical expenses but also for the loss of income that may occur due to the accident. Personal accidents could be anything and could be anywhere; like caused by Road / Rail / Air accidents; accidents due to falling, collision, fire, drowning, and other such fateful events. Personal Accident Insurance Plan is different from Life Insurance and Medical & Health Insurance. Suicide not covered in this plan.

You can either take a Personal Accident policy for yourself or a group policy for your family. It’s protecting you and them anywhere in the world and at any time of the day. Personal Accident insurance provides 24-hour worldwide insurance protection.

Facts of Road Accident in India: Mr. Nitin Gadkari, Road Transport and Highways Minister of India said in the Lok Sabha on 16th July-2019 that almost 30% of licenses are fake in India. Daily more than 1214 road accidents happened, 4.7 Lakh per year and almost 1.5 Lakh people lost their lives in a road accident and there was a rise of 1.68% in accidents in 2018, as per the recent reports. This data is very shocking for all of us. 

Features of Personal Accident Insurance Policy:

  • Accidental Death Cover: In case of death due to accident, the Personal Accident Insurance policy would pay 100% Sum Assured to the nominee or the beneficiary.
  • Total Permanent Disability (TPD) Cover: In case of TPD, the entire sum assured is generally paid to the policyholder. Some companies also pay more than the sum assured (like 125% of Sum assured is paid). Example – Loss of limbs or eyesight.
  • Permanent Partial Disability Cover: If body injured, resulting in permanent partial disabilities, then a certain percentage (up to 100%) of the benefit is paid to the insured. For example, in case of loss of one limb or loss of one eye, 50% of sum assured value will be given to the policyholder and if one finger lost then 10% of sum assured value will be given.
  • Temporary Total Disability: In case the policyholder meets with temporary total disabilities and is bedridden and not able to work and earn money, then the insurer will provide a weekly allowance to recompense the loss of income. This is generally a weekly payment that is restricted to a certain limit.

There are some more features of Personal Accident Insurance that an individual may opt to increase the effectiveness of a Personal Accident Insurance. These are:

  • Ambulance Expenditure
  • Medical Expenses / Hospital Daily Cash
  • Reimbursement for Broken Bones
  • Family Transportation Allowance
  • Loan Protector
  • Repatriation of Mortal Remains
  • Funeral Expenses
  • Child Education Expenses

How is the premium calculated?

The premium of Personal Accident Insurance Policy depends on the cover you select. The major factor of calculating premium is your profession or occupation. Insurance Companies consider your job and your risk. If you are doing a sitting office job then your premium will be low as compare to Salesman who always travels on the road because his risk is higher. For example, if you are a doctor or Software Engineer or Banker; you will fall in the low-risk category and the one who is a truck driver or working in a mine, he will fall under the high-risk category so his premium will be high.

Exclusions under Personal Accident Insurance Plans

The general exclusions that apply to most Personal Accident Insurance policies are listed below:

  • Natural Death
  • Claims amount is higher than the sum insured amount
  • Death or hospitalization expenses that arise due to suicide, attempted suicide, or self-inflicted injuries
  • Medical and Hospital Expenses due to pregnancy
  • Hospitalization expenses or death caused due to HIV/AIDS or any STD
  • Accidents occurring while the insured is under the influence of alcohol, drugs, or any other intoxicating substance
  • Hospitalization due to a criminal act
  • Accidents occurred when participating in extreme sports

Individual who travel a lot due to work should have a personal accident insurance policy as it is beneficial for you as well as for your family and dependents. You will not carry financial liability during an accident.

Insurance is not an expense, it is an investment; investment in your health, investment on your dependents, investment in your family, which always returns more than your expectations when you need it.

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