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Personal accident insurance plans cover a gap in your insurance portfolio

The latest report on Road Accidents in India 2016, published by Transport Research wing under Ministry of Road Transport & Highways, Government of India, has revealed that, India has recorded at least 4.8 lakh accidents in 2016 leading to over 1.5 lakh deaths. So, if we further slice the data, number indicates that around 413 people have died every day in accident across the country.

With rise in population and people aspirations, two-wheeler as well as four-wheeler numbers will continue to go up and road accidents will become ‘routine’. So, what are the options available in front of people to insure their family in case of some accident, which might lead to death of permanent disability. To shield against any such eventuality, people should buy personal accident cover.

Everyone knows, life insurance policy will pay only when the policy holder dies or on maturity. Health insurance will pay policy holder’s hospital bill in case of hospitalization. Both these personal accident insurance policies will not give you financial benefits. But personal accident insurance, covers the hospitalization expenses in case of road-mishap. While in the event of permanent disability, it provides cash allowance and compensation is provided to their family members in case of death of policyholder. 

Also, buying personal accident insurance is a seamless process and one can go through our website or through direct insurance companies to buy the policy. For example, a 10-lakh personal accident policy would cost anywhere between Rs 2,000-2,500 (varies from one insurance companies to another), while for 15 lakh cover it would be around Rs 3,000-3,5000 per annum.

What is covered in the policy

Typically, policy covers accidental death, where in the unfortunate event of death of the Insured person, the entire Sum Insured will be paid to the Insured person’s nominee. Even in case of permanent total disablement, the entire Sum Insured will be paid to the policyholder. While certain percentage of the Sum insured will be paid to the insured person for permanent partial disablement. The payments are made by the extent of the loss (certain percentage of sum insured), and one should always read exact terms and condition before buying the policy. For temporary total disablement, insurers pay for weekly benefits and in the unfortunate event of accidental death, insurers will pay the nominee a certain amount towards transportation of the mortal remains to residence.

Should policyholder go for standalone cover or buy it from life insurance companies

Usually, personal accident covers are provided by the general insurance companies or non-life insurers, but many life insurance companies also provide personal accident insurance policy as rider to term plan. It’s a good idea to have life insurance, but most of these policies are not comprehensive to give you full protection. However one of the drawback of plan provided by the life insurers is that, riders covers only permanent total disability and not partial permanent disability.

It’s always advisable to have a standalone personal accident policy and include all those benefits that you are required to have in it. Even say someone buys term plan for Rs 1 crore, the rider amount would be less than total sum insured and might be expensive at certain time. Policyholder should ensure that, if they get gets permanent total disability amount should be enough to maintain family lifestyle and meet all the financial goals.


So if the primary motive of the policyholder is to cover comprehensive cover, standalone accidental policy is the answer. However before buying the policy, one must read the policy wordings thoroughly to understand the policy features and exclusions before exercising any specific option. It is ample clear that personal accident insurance plans cover a gap in your insurance portfolio. Cover of health and life insurance won’t be able to keep you financially secure in case of partial or total disability. So, one must purchase a personal accident cover for the right amount too. At the time of buying a plan, make sure one compares various insurance plans so that they can opt for the best one. Finally, go for a plan that fulfills your insurance expectations and is capable of compensating for your absence when you are gone.

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