Personal Accident Insurance

What is Personal Accident Insurance?

A personal accident insurance policy covers physical loss to an individual due to accidental injuries leading to death or permanent/total disabilities. It is designed to pay compensation to the policyholder in case of an accident while travelling through rail, air, road, drowning, or due to a collision. Several health insurance plans also offer personal accident (PA) cover as an add-on.

A PA insurance policy not only pays compensation at the time of death but also financially secures the insured's family in the event of an accident. Moreover, it curtails financial constraints that may arise due to income loss resulting from accidental death or disabilities.

Alarming Statistics About Accidents in India

• Here are some statistics on accidents in India as per the Road Accidents report in 2023: Nearly 1264 road accidents occur every day in India, leading to 462 deaths.
• Around 4.61 lakh accidents took place in 2022, with nearly 1.68 lakh people dying in these accidents on Indian roads.
• One person dies every three and a half minutes in India.
• Road accidents in India saw a rise of 12% in 2023.

Why Buy Personal Accident Insurance?

Accidents do not come knocking at the door. They can happen anytime, anywhere, and may result in minor to serious injuries. Any such uncertainty may lead to a financial crisis. While a minor accident can indispose an individual temporarily, major ones can have a severe impact on a person's life and their overall well-being. This is why buying a personal accident insurance policy is recommended.

A PA insurance policy will provide financial assistance to the policyholder against accidental death, bodily injuries and disabilities (partial/ total/ permanent/ temporary), irrespective of the intensity of the accident. Moreover, in case of the unfortunate accidental death of the policyholder, the insurer extends financial support to the insured's dependents by paying compensation to the legal heir of the policyholder.

Personal accident plans also offer various riders, such as accidental hospitalization cover, hospital confinement allowance, children's education cover, etc.

Key Benefits of Personal Accident Insurance

Here is a quick rundown of some of the major advantages of buying a personal accident insurance policy:

• Family Financial Security - It ensures the financial security of the insured's family in case of accidental death.
• No Medical Tests - It does not require the applicant to undergo any medical tests at the time of buying the policy.
• No Waiting Period - A personal accident insurance policy comes with no waiting period, allowing policyholders to claim their accidental injuries from day 1 of the policy.
• Affordable Premiums - It provides substantial coverage to the policyholder in case of an accident at an affordable premium.
• Worldwide Coverage - It covers the insured against any accidents faced across the globe.
• Coverage for All - A personal accident policy provides coverage to both individuals and families.
• Cumulative Bonus - Most PA plans offer cumulative bonus in case the insured does not file a claim in the previous policy year.
• 24x7 Customer Support Service - It comes with a customer support team that is available for assistance round the clock.
• Tax Benefits - The premiums paid to purchase a PA policy are eligible for tax deductions under Section 80D of the Income Tax Act.

List of Personal Accident Insurance Plans in India

Check out the list of personal accident insurance plans in India:

*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.

You May Also Like to Read: Kinds of Health Insurance

What is Covered by a Personal Accident Insurance Plan?

A personal accident insurance policy covers the following:

1. Accidental Death

   In case an accident leads to the death of the policyholder, the entire sum assured is paid to the nominee or the legal heir.

2. Permanent Total Disability

   In case an accident results in permanent disabilities or lifelong total impairment, such as loss of both limbs, then a specified sum insured amount is paid to the policyholder.

3. Permanent Partial Disability

   If an accident results in permanent partial disabilities, then a certain percentage (up to 100%) of the benefit is paid to the policyholder.

4. Temporary Total Disability

   In case the insured meets with an accident leading to temporary total disabilities and is bedridden, then the insurer will pay a weekly allowance to compensate the loss of income. The insured can utilize this claim amount to pay the EMIs.

5. Loss of Income

   If the policyholder ends up losing the job due to accidental injuries, then the insurer will compensate a fixed amount for the loss of income.

6. Children Education

   In case of an unexpected demise of the policyholder due to an accident, the cost of education of the dependent child is covered up to a specified limit.

7. Loan Protector

   In the event of unexpected demise or lifelong disabilities of the policyholder due to an accident, a lump sum amount is paid to repay the loan amount.

8. Transportation or Repatriation of Mortal Remains

   In case of accidental death of the policyholder, the nominee would receive compensation for the expenses incurred on repatriation and transportation of the mortal remains from the site of the accident to the hospital, home or the cremation ground.

9. Cremation Expenses

   The insurer also pays for the expenses incurred on the religious ceremonies related to the cremation of the policyholder in case of accidental death.

10. Broken Bones Benefit

    In case of fractured bones or any bone damage due to an accident, a fixed compensation is paid under the policy.

11. Burns Benefit

    The insurer pays compensation to the policyholder for burns resulting from an accident.

12. Accidental Hospitalization Expenses

    If the policyholder is hospitalized due to an accident, the insurance company will pay for the medical expenses incurred during the hospital stay.

13. Life Support Benefit

    It covers the medical expenses incurred on availing life support by the policyholder during accidental hospitalization.

14. Ambulance Expenses

    It pays for ambulance charges used to carry the insured post-accident to the hospital.

15. Family Transportation Allowance

    It covers the actual transportation expenditure incurred by the immediate family member to reach the hospital where the insured is admitted after the accident. This cover is applicable only if the insured is hospitalized in another city.

16. Hospital Daily Cash

    A daily cash allowance is paid to the insured in case of an accidental hospitalization. However, the coverage is limited to a certain number of days as specified in the policy terms and conditions.

17. Home Alteration or Vehicle Modification Benefit:

    In case of permanent total disabilities or dismemberment due to an accident, the insurer pays for the expenses incurred on modifying the house and/or vehicle of the insured.

What is Not Covered by a Personal Accident Insurance Policy?

Personal accident policies do not cover death or disabilities due to:

• Natural death
• Intentional self-injury, suicide
• Influence of intoxicating drugs or liquor
• Pre-existing disability/accidental injury
• Childbirth and pregnancy
• HIV AIDS
• Adventurous or sports activities
• Mental disorders
• Terrorism
• Breach of law with criminal intent
• Being involved in war activities
• Participating in the naval, military and air force activities

How Much Personal Accidental Insurance Coverage is Enough?

As a thumb rule, a person should opt for a personal accident cover of at least 100 times of your monthly income. For example, if Mohan's current earnings are ₹10,000, then he should buy a personal accident cover of ₹10,00,000. Doing so will ensure that all the eventualities resulting from an accident, such as child education expenses, loan repayment, marriage expenses, regular earnings for the spouse, etc., are taken care of by the insurance policy.

How is Premium for a Personal Accident Insurance Policy Calculated?

The premium of a personal accident policy is decided on the basis of the applicant's occupation. Generally, occupational risks under personal accident insurance can be segmented into the following three categories:

Difference Between Personal Accident Insurance and Life Insurance

A personal accident insurance policy covers loss of life or disabilities due to accidents. But a life insurance policy covers the death of a policyholder irrespective of the cause of death. The major differences between accidental insurance and life insurance policies are listed below:

• Death Cover - A life insurance policy offers financial benefits irrespective of the reason for death apart from suicidal attempts. A personal accident policy will offer compensation in case of accidental death of the policyholder.
• Death Coverage Condition - A life insurance policy offers death cover even if the insured dies months or years after the illness. On the other hand, a personal accident insurance policy offers death cover even if the insured dies instantly or within 180 days after the accident.
• Plan Options - There are various plan options in a life insurance policy for retirement solutions, death cover, long and short-term financial investment goals, etc. But an accidental insurance policy covers loss or damage resulting from accidents only.
• Disability Cover - If an accidental injury results in total/partial loss of limb or sight, then it will be covered by a PA insurance policy. Whereas, partial disabilities are not covered under a life insurance policy.

Personal Accident Insurance vs Life Insurance Comparison Table

Difference Between Personal Accident Insurance and Critical Illness Insurance

A critical illness insurance policy pays a lump sum amount to the policyholder to carry out the medical treatment of a listed critical illness. There is a survival period clause to avail the benefits. But a personal accidental insurance policy covers partial or total disabilities and accidental death of the insured. Check out the key differences between PA insurance and critical illness cover:

Difference Between Personal Accident Insurance and Term Insurance

A term insurance policy covers the death of the policyholder due to natural reasons or accidental causes. But a personal accident insurance policy would only offer coverage for death and disabilities caused by an accident. It would not cover claims arising due to natural deaths.

How to File a Personal Accidental Insurance Claim?

To initiate the claim process for personal accident insurance, inform the insurance provider within the specified time frame. The insurer may provide a claim reference number. The following information is required to be submitted to the insurer while intimating a claim:

• Contact number
• Policy number
• Date and time of the accident
• Name and contact details of the insured
• Location of the incident
• A brief description of how the accident/ loss took place with its location details
• Extent of the loss

It is essential that these details are also known to the family members or dependents of the policyholder(including spouse), as an unexpected event such as the demise of the insured may leave them unaware of what to do next.

Submit all the required documents to the insurer. The insurer will verify the documents and pay the claim amount to the policyholder or the nominee as the case may be.

Documents Required to File a Personal Accident Insurance Claim

In case of accidental death/ impairment claim, the following documents are required to be submitted:

• Death certificate
• Post-mortem report
• FIR report
• Medical certificate
• Medicine bills
• Any other document requested by the insurer

FAQs