While you may not be able to prevent an accident, you can always cover for expenses incurred due to disability, which may lead to your inability to earn and can also hamper the interest of your family members, with insurance. However, an accident insurance cover falls in the grey area, which is neither covered by health insurance nor life insurance.
While a term life insurance policy helps your family stay financially independent and address major life goals in your absence, what if an accident impairs your ability to earn by leaving you temporarily or permanently disabled? Life insurance doesn’t provide the required coverage, and you cannot rely entirely on health insurance, as it covers hospitalization charges alone.
In order to remain secured in case of unforeseen circumstances as these, you must purchase a personal accidental insurance policy. Here’s why you must have a personal accident cover in your portfolio:
Accidental death benefit
A personal accident cover offers accidental death benefit to your nominee. It means in case you succumb to your injuries due to an accident, the sum assured mentioned in the policy is paid to the beneficiary.
The money received can be used to meet the family’s day-to-day expenses and also other financial commitments such as loans taken.
Cover against a disability
Personal accident insurance policies provide coverage against a disability caused due to an accident. The disability can be temporary or permanent in nature and in the worst case can impair your future income potential.
This policy offers coverage for all types of disabilities and even minor injuries sustained during an accident. Coverage is also provided for loss of limbs, eyes, arms, etc. Details are provided in the policy’s terms and conditions.
Total permanent disability benefit
In case of total permanent disability suffered due to an accident, a personal accident insurance cover offers a complete permanent disability benefit by paying the entire sum assured. The money helps you and your family meet regular expenses.
Also, in case you are bedridden for say 6 months following an accident, a personal accident insurance cover makes up for the income loss during that period by paying a certain percentage of the sum assured either weekly or monthly.
Daily hospital allowance along with hospitalisation expenses
While a regular health insurance policy reimburses only hospitalisation costs incurred due to an accident, a personal accident insurance cover offers daily hospital allowance. This fixed amount can be used to cover expenses related to food, transport, etc.
On top of this, the insurer also reimburses the hospitalisation expenses. Thus, it prevents drying up of savings in case you need prolonged hospitalisation due to an accident.
The essential lookouts
There are certain things to look out for while buying a personal accident cover. Go through the policy’s terms and conditions well to know the types of disabilities covered. Also, do check if the policy has any waiting period or not. It’s essential to opt for a cover which is at least 10-15 times of your annual income as the policy acts a source of secondary income in case of death or permanent disability.
You can use several personal accident premium calculators available online to gauge the premiums payable. Also, while buying the best accidental insurance plan do compare multiple offerings from different insurers to make an informed choice.