Benefits of a personal accident insurance cover

“Anything tragic can only happen with others, not me”— is a belief that most of us live with; and when something drastic strikes us, it’s often too late and the situation has most likely soared out of control.

As revealed by the World Health Organization (WHO) in its first-ever Global Status Report on Road Safety (2009), with over 1,30,000 deaths annually, India has overtaken China and now has the worst road traffic accident rate worldwide, with up to 14 persons dying due to road accidents per hour.

Usually people have two types of insurance covers; life and health insurance. While life insurance covers the risk of death and a health insurance acts as a cushion against hospitalisation expenses, people mostly forget the third equally beneficial type of insurance which is a personal accident insurance. You cannot predict an accident, yes; however, if you have a personal accident insurance plan, you can protect yourself against the financial consequences of an accident.

An injury after an accident can wipe out your savings and future finances may be in danger if you are disabled and can even impact your future where your job and livelihood is concerned. Besides paying out following an individual’s accidental death, it would also pay out in the case of permanent or partial disablement.

Basic compensation
As the name suggests, death or injury due to any illness or disease is not covered by the policy. It is essentially designed to offer basic compensation to the insured person who undergoes physical injury as a result of an accident which is external, impactful and disabling in some shape or form.

In such a case, while health insurance would only take care of an individual’s hospitalisation expenses; it would not protect the family from loss of livelihood. Thus, personal accident insurance is a necessary safeguard against loss of income following an accident. Apart from the basic package, there are other schemes available in the market as per your convenience.

For example, the family package cover is available to individuals under whereby the proposer, spouse and dependent children can be covered under a single policy with a set discount in premium.

Specified groups
Also, there are group personal accident policies available for specified groups with a discount in premium depending on the size of the group. Nevertheless, it is important to remember to not make a rushed and an ignorant decision.

Ensure that you thoroughly go through the policy documents before signing, because similar to health policies; personal accident policies have exclusions as well.  For example, accidents under the influence of alcohol or from dangerous sports are not covered under personal accident insurance claims.

Personal accident cover is as important as life and health insurance cover. If we knew what is to befall us in the near future, it is easier to provide for such an emergency.

Personal accident insurance, in this case comes to the rescue. I believe the saying “Better safe than sorry” is a simple and profound thought which holds the larger truth of life.

(The writer is Senior Executive Director at Star Health and Allied Insurance)