What Is Personal Accident Insurance & How It Helps In Financial Planning
With erratic lifestyles and hectic schedules, people are racing against time which can come to a screeching halt in the event of unforeseen circumstances. Today, as we step out on the road, we pretty much carry our heart up our sleeves, quite literally, as the odds of running into a fatal accident are far higher than ever, given the worsening condition of Indian roads. In this alarming scenario, an individual personal accident insurance is your best bet for financial support. It is highly pocket-friendly and flexible.
Personal accident schemes cover the policyholder against death or disability caused due to an accident. Apart from the basic death cover, one can buy additional protection against partial and total disability; loss of earnings pertaining to occupation due to a temporary impairment in the aftermath of an accident can also be covered. There is an option to cover the family as well.
A Personal Accident policy plugs a burning hole in the overall insurance portfolio to provide the policyholder with financial support in the aftermath of an accident. Let’s see how it helps in your financial planning portfolio:
- Disability cover: If the policyholder is completely or partially disabled after an accident, then this type of policy will assist him with financial support regardless of the type of injury. Suppose, in the event of the policyholder’s demise in an accident, his nominee gets accidental death compensation benefits.
- Emergency accident medical expense: Following an accident, the victim needs immediate medical attention and personal accident policy provides coverage for hospital bills, medical treatment that are not due to a pre-existing condition, as well as other expenses like repatriation charges, funeral expenses in the event of policyholder’s demise, and ambulance charges.
- Compensation for loss of income: If the policyholder suffers a fracture or a disability like loss of eyesight, speech, or hearing impairment, the policy compensates for the loss of income. Suppose a person suffers temporary total disability, then the insurer will grant the policyholder a weekly benefit.
- Children education benefits: Personal accident insurance ensures that education expenses of victim’s children are not impacted as it provides an education benefit for the children amounting to 10% of the principal sum insured or the actual tuition fee charged by the institution, whichever is lower.
- Modification allowance: Due to the accident, if the policyholder gets paralyzed and bound to a wheelchair, he may require structural adjustments to accommodate and ease his movement. The policy compensates to make such necessary alterations in his home and vehicle to facilitate easy movement.
- Family transportation: If the insured person is confined in a hospital outside 150 km of his home, the immediate family member will incur certain transportation expenses to reach the hospital. This insurance will reimburse these expenses up to a certain limit.
However, before deciding on the personal accident cover, one must watch out for the policy exclusions and be aware of options such as free-look period of 15 days which gives the policyholder the freedom to cancel the policy within that period and also ‘grace period’ of 30 days of policy renewal.
Besides, the irrefutable benefits and needs of personal accident insurance, it is recommended to buy the policy from a reputed insurer, well trusted in the market for consistent services and superior claim settlement track record.