A SIMPLIFIED GUIDE TO BUYING PERSONAL ACCIDENT INSURANCE
A SIMPLIFIED GUIDE TO BUYING PERSONAL ACCIDENT INSURANCE :_
Life is full of unknown factors. One can never really predict how the road ahead will bend. While accidents can happen anywhere and at any time, one of the most common ones is road accidents. They have become a significant root cause of death, injury, and property damage, especially in India. Recently, this fact came into highlight with the high-profile death of Mr. Cyrus Mistry, the former Chairman of Tata Sons, in a car accident.
Let's look at some intense statistics about road accidents in India.
- Every year, an average of around 4.5 lakh accidents are reported.
- Approximately, 1.5 lakh people are killed in road accidents every year.
- As per UN WHO, the traffic fatality rate for India is about 17 per 100,000 people.
- In 2020, when the entire world was in lockdown, there were still 3.66 lakh road accidents in India.
- Road traffic fatalities increased by 7% in the first five months of 2022.
- The victims of Indian road accidents are mainly between the age of 25 and 35.
All these figures indicate how fatal personal accidents are and how vital it is to have insurance. But we are not just exposed to just one single type of accident. As said, accidents can happen anytime anywhere, even in the comfort and safety of your home. When accidents occur, they result in a substantial cost in treatment and recovery. Often, an individual also loses the ability to work and suffers a loss of income. Worse, there can be a disability, temporary or permanent. Most of these are not covered under a standard health insurance policy. Fortunately, personal accident (PA) insurance provides an ideal cover for these risks. A typical personal accident insurance provides a financial safety-net against accidents resulting in bodily injury, permanent partial disability or permanent total disability and accidental death. The best thing about PA policies is that they are very affordable and you can choose a higher sum assured which would otherwise not be possible with traditional life and health policies.
In spite of its many advantages, many people still do not know much about PA policies and often do not have the same in their portfolio. We present a simplified guide to buying PA policy that can help you decide wisely.
A] PLAN TYPE
There are two types of PA insurance policies available. A family PA policy and an individual PA policy. You can choose between both, depending on your needs. Please remember, spouses and children are entitled to a limited cover per policy. Therefore, make sure that the policy covers all of your family members appropriately. Comprehensive and adequate coverage of the earning member is of prime importance under a PA policy.
B] POLICY COVERAGE
There are mainly four types of coverages available under PA insurance:
It is in which the sum assured of the policy is payable to the nominee in the event of the policyholder's death
It is in which a pre-determined amount is paid to the policyholder if an accident results in permanent disability, such as loss of both limbs or eyesight (both eyes).
It secures the insured financially from a permanent partial disability in an accident. In this case, the insured receives a percentage (up to 100% of the sum assured) of the benefit. For e.g., loss of one limb or eyesight of one eye.
It provides coverage to the insured suffering from a temporary total disability and is bedridden for an extended period. The insurer here gives weekly compensation for the loss of income during the period of disability.
Most insurance companies provide all four coverages in a comprehensive PA policy. Therefore, one should prefer the comprehensive PA policy for maximum coverage and benefits. The cover should include activities that could result in accidents at various workplaces such as home or office/work. Generally, a PA insurance policy provides worldwide and 24*7 coverage. It means it will provide the above-mentioned benefits to policyholders anytime & anywhere.
C] PREMIUM
As previously said, PA policies are very affordable. One may, however, choose a policy with balance of the premium amount and the coverage provided. Moreover, premium rates are the same from 18 to 69 years and PA policies do not consider the age factor in premium pricing. Furthermore, occupation plays a vital role in deciding the premium amount of PA policy as the risk of accident is more or less related to the nature of the work of an individual.
D] CLAIM SETTLEMENT PROCESS
It is also important to select a reputable insurer through a reliable insurance intermediary/agent. The track record of a company's claim settlement speaks volumes about its quality and dependability. You may inquire about the claim process & ensure that it is quick and easy. You may also learn about the claim handlers also known as Third Party Administrators (TPA) participation and their claim history.
E] BENEFITS
PA policies also come with add-ons and riders which provide additional benefits such as hospitalization, blood purchase, transportation of mortal remains, burns, coma, and so on. Some plans include these benefits, while others require you to purchase them as add-ons. Choose the one that best serves you for a reasonable premium.
F] EXCLUSIONS
PA policy excludes certain events from the policy, like self-harming cases of suicide and criminal acts, pre-existing diseases, natural death and so on. Therefore, keep a keen eye on exclusions in the policy. Pay attention to policy details during the purchase.
CONCLUSION
To summarize, consider all of these factors before deciding on the ideal policy for you. PA insurance can help you prepare for unforeseen events not covered under other policies. Regardless of your age or health, it is prudent to obtain PA insurance, especially in Indian circumstances. Before you sign the policy, please understand the risks covered and other finer aspects of the policy, in fact for every policy, not just this one.
Stay Financially protected!
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😊Hope you enjoyed or appreciated reading this one. Thank You, keep safe & Be Empowered... 😊
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