Why you must buy a personal accident insurance policy

This insurance policy covers permanent total disablement, permanent partial disablement, temporary total disablement, accidental death and double indemnity for permanent total disability and accidental death, says Mukesh Kumar, Executive Director, HDFC ERGO General Insurance Company

By definition, accidents are unpredictable -- they can occur to anyone, anytime; despite all care and precautions they just happen if they have to. Life is full of uncertainties and one never knows how and where an accident may take place causing a bodily injury that may have financial implications. One faces threat of potential accidents from the ever-rising number of vehicles plying on the road; rising number of electrical equipment/gadgets, under-construction buildings/roads, fires etc. Every day, there are reports in the newspapers about accidents causing injuries– minor as well as major -- or even death to people.

There are physical as well as financial consequences of accidents. While injuries can incapacitate you temporarily or permanently, they can even drain your lifetime savings, leaving your family in a difficult situation without resources or help. Hence, securing your family’s future and enabling their basic day-to-day needs in absence of income becomes utmost priority for you.

While it may not be always possible to avert accidents, one can certainly deal with the trauma of financial burden of an accident with a right ‘personal accident insurance'. Personal accident insurance or PA insurance is an insurance plan which provides compensation in the event of injuries caused due to accidental events.

While we would not wish you to ever have to take benefit of a PA insurance, we strongly recommend you get a cover that protects you and your family from the financial implications of accidents.

A PA insurance policy covers permanent total disablement, permanent partial disablement, temporary total disablement, accidental death and double indemnity for permanent total disability and accidental death. After all, it is better to be safe than sorry.

We should be ready to face the accidental situations by doing whatever is in our control to mitigate their financial impact. Taking an insurance to cover any accident causing bodily harm is of help in so many ways. Primarily, it helps by compensating you in the event of an accident that may require hospitalisation. With ever-rising hospitalisation costs, having a means to pay for such treatment for an accident would certainly be of great help.

A standard PA insurance policy ensures your family’s financial security in the hour of need. Death, permanent total disability, temporary total disability, broken bones, burns and ambulance costs are covered under the policy. The personal accident insurance plan can also be extended to include your entire family under a single policy.

What does a standard PA insurance cover?

Accidental death: If the physical injuries due to an accident lead to death of the insured, 100 per cent of the policy sum insured is reimbursed

Permanent total disablement: If the physical injuries due to an accident results in permanent disablement, then up to 100 per cent of the policy sum insured is payable to the insured

Broken bones: If the physical injuries to the insured results in bone fractures, then up to 10 per cent of policy sum insured is payable under the policy

Hospital cash (illness & accident): In the event of insured’s accident or illness, a daily assistance for hospitalisation up to 45 days is provided

Burns: If an accident results in hospitalisation of the insured and treatment of burns, up to 5 per cent of policy sum insured is payable

Ambulance expense: Ambulance costs incurred on the insured post-accident are reimbursed as per the policy

Anyone below the age of 65 years is eligible for the coverage under a regular PA insurance policy. Sum insured typically ranges from Rs 2.5 lakh to Rs 15 lakh in policies offered by Indian insurers. They offer a comprehensive coverage at affordable price, which is also extendable to the entire family in a single policy including dependents -- parents and children.

Most PA insurance policies come with no boundary limits -- they offer coverage for accidents in India as well as outside of India (of course, with some restrictions). Coverage on ambulance expenses as well as daily cash reimbursements for hospitalisation due to accidents and sickness are also included in the most PA insurance plans.

Photograph: Amish Patel/Creative Commons