What is Personal Accident Policy?
There are many types of insurance plans in Health Insurance, in which Personal Accident is also a plan which covers the liabilities of the Insured Person. This is a fixed benefit plan in which when the death claim is raised, the insured person or the nominee gets the insurance amount and the plan ends. But if the insured person dies or becomes completely disabled for a few days or months, the plan continues to provide relief. The insured person gets a fixed amount of relief every week in case of complete temporary disability. As per data from the Ministry of Road Transport and Highway, in India During the year 2021, a total number of 4,12,432 road accidents have been reported in the country, claiming 1,53,972 lives and causing injuries to 3,84,448 persons. Unfortunately, the worst affected age group in Road accidents is 18-45 years, which accounts for about 67 per cent of total accidental deaths. Every year the lives of approximately 1.3 million people are cut short globally as a result of a road traffic crash. Unfortunately, more than 90 percent of road traffic deaths occur in low- and middle-income countries, even within high-income countries, people from lower socioeconomic backgrounds are more likely to be involved in road traffic crashes. India ranks at the top with the highest number of fatalities with about 11% share in the world.https://morth.nic.in/sites/default/files/RA_2021_Compressed.pdf
Now the question arises that when we have an Indemnity Plan of Health Insurance and a term plan of Life Insurance, then what is the need for a Personal Accident Plan?
Introduction
An Indemnity Plan of Health Insurance is useful in our medical emergency whereas a Term Plan of Life Insurance after the death of the insured member, his nominee gets 100% of the sum insured whereas a Personal Accident Plan covers our liabilities like any Personal Accident(PA) Policyholder. If a person meets with an accident and neither dies nor suffers from any illness, such as complete disability or inability to work for a few months, then in such a situation neither a Health Insurance Indemnity Plan nor Term Insurance Plan will be useful. In this situation, only a Personal Accident plan will be useful. This plan is given according to the annual income and job profile of the customer.
To know how this personal accident plan works, I am writing all the information one by one about its risk category, basic features, and optional features.
Risk Category
Personal Accident Plan is available according to Occupational Risk which the Insurance Company generally keeps in 4 categories.
- Risk Category I – Personal accident plan includes all those occupations in which there is very little chance of having an accident, like Official Work, Management, Clerical Work, Admin Work etc.
- Risk Category II- Personal accident plan includes all those occupations that have less risk like sales, insurance agents, field work etc
- Risk Category III- Driver Commercial, Bike Rider, etc.
- Risk Category IV- Underground Works, Mines, Pilot, Police Personnel’s, PA Policy is not given in all these.
Basic Features
These are those features that are built into the Personal Accident policy, Optional Cover – These covers can be taken by paying some extra premium.
Accidental Death (AD)
Permanent Total Disablement (PTD)
Permanent Partial Disablement (PPD)
Education Benefit
Emergency Road Ambulance Cover
Funeral Expenses
Repatriation of Moral Remains
Orphan Benefit
Modification Benefits Vehicle and Resident
Compassionate Visit
Cumulative Bonus
Accidental Death (AD)
Now we know about all the features one by one, in Basic Features we will know about all those features that are available in-built in PA Plans.
Accidental Death (AD)
Death due to any kind of accident is called Accidental Death (AD) and the nominee gets 100% of the insurance amount, no matter what the reason for this accident.
Permanent Total Disability (PTD)
When the insured person does not die due to an accident but some body functions stop like loss of vision in both eyes, both hands, both legs, one hand, one leg, one loss of vision, becoming deaf, becoming mute, all these are kept in PTD. The policy stops when a PTD claim is made.
Permanent Partial Disability (PPD)
When due to an accident any part of the body stops working partially forever, then it is called PPT and in this, the benefit to the insured person is paid according to the extent of damage to the part. And the policy continues. PPD benefits Chart
Education Benefit
After the death of the insured person, his dependent children who are below 25 years of age and are not in any employment and are continuing their education, will get 10% of the sum assured or whatever as per the terms of the plan. Yes, you will get it. This amount is in addition to the total sum insured
Emergency Road Ambulance Cover
If the insured person gets injured due to an accident, in that case, under this benefit, the cost of a Road Ambulance is covered as per the plan, there are limits in this, which the insured person should know about in advanced
Funeral Expense
PA policy insurance company gives the option of variants in its plans and in these, if death occurs due to accidents, then 1% of the plan or whatever is pre-determined, then the expenses for the last rites are also available, this is the basic sum. Get different from insured
Repatriation of Remains
In case of death due to accidents, whatever expenses will be incurred in taking the body of the insured person to his home or the place of cremation, he will get a lump sum which may vary according to the plan
Orphan Benefit
When the insured dies due to accidents, a lump sum amount is given to his dependent child under Orphan Benefits which is in addition to the total sum insured and provided that the dependent child is below 25 years of age and is suffering from any kind of disability. Money is not available If the child is below 18 years of age, then the amount of this benefit will be given to whoever is the legal guardian. This amount is either pre-determined as per the plan or maybe a part of the full sum assured, such as 10% or 15%.
Modification Benefits (Residents and Vehicle)
When the insured person does not die due to the accident but gets partial or complete permanent physical disability, then the insurance company gives a lump sum amount under this benefit as per the plan, which is for rehabilitation. It is given instead of taking the vehicle and vehicle to the new place of residence, this applies only to relocation in India.
Compassionate visit
If the insured person is admitted to the hospital due to an accident, then the insurance company pays the travel expenses to his nearest relative as per the plan, the nearest relative includes his children (including adopted children), siblings, etc. -Father, mother-in-law, brother-in-law, sister-in-law, and any legal guardian
P.A Cumulative Bonus
As in every claim-free year of health insurance, some percentage increase is given in the total sum insured, such as 5%, or 10%, this may vary according to each insurance company.
These are all the basic features of PA, if there is a death claim or full permanent claim in this policy, the plan gets terminated. Insurance companies can offer many variants of PA plans.
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