Why Should You Buy a Personal Accident Insurance Policy?

Life is uncertain and accidents can happen anytime. But did you know personal accident insurance plans are of great help during an accidental emergency? It provides financial support to the policyholder and the family if he/she becomes disabled or dies due to an accident. In this article, know why buying a personal accident insurance policy is a must.

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      How Personal Accident Policy is Beneficial?

      The need for a personal accident policy arises from the fact that a life insurer offers financial security only in case of death of the policyholder. Accidents however could render one disabled temporarily or permanently, resulting in loss of income, besides an additional burden of medical expenditure. A personal accident policy not only pays at the time of death, but also financially secures you and your family in the event of an accident. It curtails financial constraints that may arise due to income loss.Minor accidents like falling off a bicycle or fracturing an arm are covered by the policy.

      What does Personal Accident Policy Cover?

      A personal accident plan is equipped with the following features:

      • Accidental death benefit - In the unfortunate event of death of the policyholder, the insurer pays the entire sum insured to the nominee.
      • Permanent total disablement - In this case, a certain percentage of the sum insured will be paid to the policyholder.
      • Permanent partial disablement - In this case, a small percentage of sum assured is paid to the policyholder on a weekly or monthly basis. For instance, loss of hearing in one ear, loss of index finger/any other finger, loss of one hand, etc.
      • Temporary total disablement - The policyholder is entitled to get weekly benefits for accidents resulting in confinement up to 104 weeks. For example, fracture in hands or legs.
      • Education grant - The policy bears the education cost of maximum two dependents kids up to the age of 23 years.
      • Transportation of mortal remains - In the unfortunate event of an accidental death, the insurer pays a fixed amount towards transportation of mortal remains. 

      What is not Covered under Personal Accident Policy?

      Accidental policies do not cover disability or death due to:

      • Intentional self-injury, suicide
      • Influence of intoxicating drugs or liquor
      • Breach of law with criminal intent
      • Pre-existing disability/accidental injury
      •  Death or disablement resulting from child birth and pregnancy
      • AIDS/HIV
      • Terrorism
      You may also like to Read: Income Tax Deductions

      How is Premium Calculated?

      In case of personal accident policies, coverage and premium depends on the current level of income and nature of the applicant’s occupation. If you are a teacher living in Delhi, then your chance of meetingan accident is less than a miner. For calculating the premium, insurers have categorized occupations according to the risk level.

      Risk Level I (Low Risk) Risk Level II (Medium Risk) Risk Level III (High Risk)
      Administrative / managing functions Machine Operator  Mine workers
      Doctors Garage mechanic  Jockey
      Accountants Manual labor Mountaineers
      Teachers  Builder Professional river rafters
      Architects Veterinary Doctor Big game hunters
      Lawyers Contractor  Circus Performers

       

      Similar term insurance, premium of a personal accident policy is also very low. For example, HDFC Ergo’s personal accident policy offering Rs 15 lakh can be bought at Rs 2359 only.

      Available Options in the Market

      Some of the popular personal accident policies available in the market are:-

      Insurance Company Personal Accident Plans Age ( in years) Coverage Amount ( in Rs) No Claim Bonus
      Aditya Birla Health Insurance Activ Assure Personal Accident Plan Min:5 years
      Max: 65 years
      12 times of yearly gross income N/A
      Bajaj Allianz Health Insurance Personal Guard Plan N/A 10 Lakh-25 Lakh Up to 50 %
      Cholamandalam Health Insurance Chola Accident Protection Min: 18 years
      Max: 69 years
      Family:2.5 Lakh-10 lakhs
      Individual: 5 lakhs to 1 Crore
      N/A
      Future Generali Health Insurance Personal Accident Plan Min: 18 years
      Max: 70 years
      up to 144 times of annual income N/A
      HDFC ERGO  Health Insurance Personal Accident Plan Min: 91 days
      Max: 69 years
      5-500 lakhs N/A
      IFFCO Tokio Health Insurance  Personal Accident Policy Min: 5 years
      Max: 70 years
      100% of sum assured 5%-50%
      Liberty Health Insurance Individual Personal Accident Policy Min: 18 years
      Max: 70 years
      1 lakh - 1 Crore N/A
      Manipal Cigna Health Insurance Protection Accident-Care Min: 18 years
      Max: 80 years
      50,000- 10 Crore N/A
      National Health Insurance  Personal Accident Plan Min: 5 years
      Max: 70 years
      72 months gross pay or Rs.10 lakh whichever is less. 5%-50%
      New India Assurance Health Insurance Personal Accident Policy Min: 5 years 
      Max: 70 years
      N/A 5% -50%
      Niva Bupa Health Insurance Personal Accident Health Insurance Min: 18 years
      Max: 65 years
      5-25 lakhs 5%-50%
      Oriental Health Insurance Janata Personal Accident Policy Min 10 years
      Max: 80 years
      25000-5 lakhs N/A
      Religare Health Insurance Secure Personal Accident Insurance Plan Min: 18 years
      Max: 70 years
      15 lakhs- 25 Crores N/A
      Raheja QBE Health Insurance Individual Personal Accident Insurance Policy As per policy document As per policy document 5% -25% of the initial sum assured
      Royal Sundaram Health Insurance Individual Personal Accident Policy (Death & Disablement Only) Min: 18 years
      Max: 65 years
      5 - 75 Lakh 5% for each claim free year; limited to 25% of the initial sum assured
      Reliance Health Insurance Personal Accident Group Insurance Policy Min 5 years
      Max: 70 years
      100% of sum insured in case of permanent total disability N/A
      Star Health Insurance Accident Care Individual Insurance Policy Min: 18 years
      Max: 70 years
      5 Lakh-15 Lakh 5% for each claim free year; limited to 50% of the initial sum assured
      SBI Health Insurance  Individual Personal Accident Plan Min: 18 years
      Max: 65 years
      1 Lakh- 10 Lakh 5%-50%
      TATA AIG Health Insurance Personal Accident Gaurd Plan Min: 18 years
      Max: 65 years
      1 year with lifetime renewal 5 Lakh- 1 Crore
      United India Health Insurance  Individual Personal Accident Plan  Min: 5 years
      Max: 70 years
      1 year 25,000-10 Lakh
      Universal Sompo Health Insurance  Individual Personal Accident Policy Min: 5 years
      Max: 65 years
      1 year N/A
      Zurich Kotak (formerly known as Kotak Mahindra) Health Insurance Zurich Kotak Accident Care   Min: 5 years
      Max: 65 years
      N/A N/A
      See more plans

      *Disclaimer: The list mentioned is according to the alphabetical order of the insurance companies. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website www.irdai.gov.in.

      Many people avoid personal accident policies due to the absence of tax benefits. However, if your job requires constant travelling by using any mode of transport, you would be considered to be accident-prone. In this case, it is advisableto buy a personal accident policy. This policy provides complete protection against accidental risks and thus, offers financial security in the event of death or disability. The plan works well when you buy it as an individual policy or not as a rider attached with a life insurance policy.

      You may also like to Read: Section 80C

      Disclaimer : *Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

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      Disclaimer: The list mentioned is according to the alphabetical order of the insurance companies. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website www.irdai.gov.in

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      *We will respond in the first instance within 30 minutes of the customers contacting us. 30-minute claim support service is for the purpose of giving reasonable assistance to the policyholder in pursuance of the claim. Settlement of claim (including cashless claim) is the responsibility of the insurer as per policy terms and conditions. The 30- minute claim support is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. For further details, 24x7 Claims Support Helpline can be reached out at 1800-258-5881.

      *Product information is authentic and solely based on the information received from the Insurer. Policybazaar is acting only as a facilitator and claims settlement shall be at the sole discretion of the Insurer. Policybazaar does not provide any medical or surgical advice or diagnosis and is not responsible for your interactions / treatment by a medical practitioner/hospital. Please consult a registered medical practitioner for any medical or surgical advice. The Information that you obtain or receive from Policybazaar, and its employees, or otherwise on the Website is for informational purposes only. As per the Insurance guidelines, you are allowed to cancel the policy with-in 30 days from the date of Issuance of policy.This option is available incase of policies with a term of one year or more.

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      *₹400/month is the starting price for ₹ 5 lakh Health insurance for a 30 year old male & 29 years old female, living in Delhi with no pre-existing diseases

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