The Importance of Personal Accident Insurance

The Importance of Personal Accident Insurance

Accidents never occur with a warning. However, their far-reaching implications topple the balance in our lives, sometimes, even to the extent of life-changing experiences. Due to the unpredictability of accidents, especially when they involve the earning member of a family, it impacts many lives at once.

As the accident capital of the world, India makes up 11 per cent of total road accidents each year, according to a report by the World Bank. About 4.5 lakh road accidents occur each year, killing 1.5 lakh people. In such unfortunate situations, Personal Accident Insurance comes in handy and provides coverage to the insured against damages caused due to an accident.

What is a Personal Accident Cover?

A personal accident policy protects the insured against death or disability caused by an accident. It simultaneously provides financial help to the dependent family members and unburdens them at a crucial time. The payout provided by an insurer depends on the accident’s impact, with different payouts for partial and permanent disability.

A personal accident insurance policy provides compensation for three types of disabilities. First, Total and permanent disability, in which the policyholder suffers from significant, irreversible damage and is unable to earn or live regularly. The second is Partial and permanent disability, in which the policyholder suffers partial but irreversible damage that reduces their capacity to live a regular life to a great extent. Lastly, Total and temporary disability, where the policyholder suffers physical damage that prevents them from living a normal life temporarily.

Why Get Personal Accident Cover?

In a country like ours where accidents have moved beyond roads, devastating lives in places like construction sites, footpaths, etc., a Personal Accident cover is highly needed. As one of the most effective ways to ensure personal safety, a personal accident cover safeguards your finances in the unfortunate event of an accident. Regardless of how hard-hitting the impact of an accident is, it could adversely affect the life of the dependants. Hence, getting a personal accident cover can give you an upper hand in such situations and protect your family.

The point of a personal accident cover is to provide coverage for an accident that may cause serious injury or even death or disability. Under either scenario, the lives of dependents are directly impacted and require financial support. Moreover, besides giving coverage against disability and death, several personal accident covers provide financial support to the insured. The thought behind this consideration is to financially capacitate a completely or partially affected individual after an accident. While the personal accident cover might not be the most commonly opted insurance in India, it is one of the best ways of getting vital security.

How Does a Personal Accident Insurance Work?

The payout for a policyholder depends on the total sum insured and the accident’s impact. Therefore, accidents involving death or permanent disability receive the entire payout, while accidents involving partial damages are covered depending upon the severity of the disablement. It is advised to carefully go through the agreement of a policy to understand its payout.

Besides its elementary function, the personal accident cover could be integrated with add-ons to provide holistic support to the policyholder. Some popular add-ons for personal accident cover include Hospital Cash Benefits, Ambulance Expense Cover, etc. These add-ons further supplement the personal accident cover with an extensive safety net.

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