Best Personal Accident Insurance Policy In India

Is personal accident insurance mandatory? Should you take a personal accident insurance policy? Personal accident insurance is a policy that provides compensation to the insured or his/her family members in case of death or disability due to an accident. An accident is an event that is a sudden, unforeseen,  and involuntary event caused by an external, violent, and visible means. The insured pays a certain amount as a premium towards the personal accident cover and in turn, the insurer pays the compensation in case of any event such as death or disability.

The personal accident insurance policy provides compensation only in the case of accidental death or disability. The premium charged for personal accident insurance is quite less compared to other insurance policies.

A personal accident cover means it will provide coverage for medical expenses if the owner-driver of the car gets injured in an accident. It comes as an add-on cover that a comprehensive car insurance policyholder can purchase by paying an extra amount in the premium.

Compulsory Personal Accident Cover: A compulsory personal accident or PA cover is an add-on cover offered by motor insurance providers to the owner-driver of a car that protects him against any accidental injuries. It provides compensation in case the owner-driver of the car suffered from bodily injuries, permanent disability, or death following the car accident.

Example: Death/ disability due to natural causes is not covered under personal accident insurance

Mr. Karun works in an FMCG company in the sales department, his duties include visiting grocery shops and pitching company products. He is married with two kids and is the sole bread earner in the family. His company provided him Health insurance as well as life insurance; health insurance included his family as well. One of his friends working in the insurance sector advised him to take personal accident insurance as well to cover his life against death and disability.

One bad day when he was driving to work he met with a serious accident and was admitted to a hospital. Due to the severity of the accident doctors amputated both his hands and he was in ICU for a considerable period.

The hospital bill was covered by his company under the group health insurance taken by his organization. After discharge from the hospital, he was in dilemma about his work continuity with the organization, as his work involves travel and he is in no situation to travel. This made him think of his future and search for a job immediately as he was into sales and the job involves travel which is difficult for him to do.

He remembered that he had purchased a personal accident policy and made a claim under it with the insurance company. Since he suffered a permanent total disability, he was paid the sum insured in full by the insurance company. With this financial assistance from his insurance policy, he set up a small business to feed his family.

Had he not taken the personal accident policy, he would have faced a financial crisis as he was out of a job due to his inability to perform his duties.

Compulsory Personal Accident in Motor Insurance:

As per the IRDA mandate, it is compulsory to have a personal accident cover (CPA) of Rs.15 Lac with any motor insurance policy.

The cover under the personal accident policy in motor insurance is provided to the Owner-driver whilst driving the vehicle including mounting into/ dismounting from the vehicle or traveling in the insured vehicle as a co-driver.

You can opt-out from buying this cover under the following conditions:

• You have a valid personal accident insurance policy of at least Rs.15 Lacs Sum insured.
• You have a valid personal accident insurance policy for your other vehicle with Rs.15 Lacs Sum Insured.

The scope of cover under the personal accident insurance in motor insurance is as follows:

Advantages of Personal Accident Add-On Cover in Car Insurance:

Accidents can happen with any individual at any point of time in life. Therefore, it is important to consider buying a personal accident cover along with a comprehensive health insurance plan to ensure complete protection. Some of the advantages offered by personal Accident cover in Car insurance include:

• Offers financial aid to the policyholder for any healthcare expenses including drugs, hospital bills, and treatment.
• Offers financial assistance to the policyholder for any income loss in case an accident leads to a permanent disability of the patient.
• Apart from the policyholder, the personal accident cover is also beneficial for surviving members of the deceased’s family.
• It does not matter if the injury suffered is major or minor, in both cases, the policyholder is eligible to avail compensation by the insurance company.
• There are certain insurance companies that offer coverage for partial and temporary disability excluding total dismemberment or demise cover.

Types of Personal Accident Insurance Plans:

Followings are the types of Personal Accident Insurance Plans:

1. Individual Accident Insurance: This type of personal accident policy protects an individual in an event of any accidental damage. It covers accidental death, loss of limbs or sight, or other permanent disabilities of the policyholder which may occur due to an accident.
2. Group Accident Insurance: Group Accident Insurance is generally taken to get coverage of their employees by the employers. Depending on the size of the group, some of the insurance companies also provide a discount on the premium. It is a great move/ value-added advantage for small organizations as it is available at a low cost. However, this is a very primary plan and which can offer limited benefits in comparison with individual plans.

Compulsory Personal Accident Insurance Coverages:

• Accidental Death Benefit: Personal Accidental Insurance provides 100% sum insured to the nominee in case of accidental death of the insured. It is like the primary protection that comes with the policy and makes sure that the family is financially steady after the grievous passing of the policyholder. The nominee of the policy is a legitimate beneficiary of the individual.
• Permanent Total Disability Benefits: Personal Accidental Insurance benefit provides coverage for injuries and permanent disabilities that hinder the individuals from engaging in the occupation after an accident. The total disability could be the loss of both the eyes or the physical separation of limbs.
• Hospital Daily Cash: Daily cash allowance is paid to the insurance company in case of an accidental hospitalization. Coverage is limited to a specific number of days.
• Ambulance Expenses: Compensation is provided for ambulance expenses to carry the insured after an accident to the hospital.
• Bodily Injuries: The cost incurred for medical treatment of bodily injuries sustained by the policyholder in an accident is covered under this plan.
• Burns: Compensation is also provided for accidental burns.
• Family Transportation Allowance: When the residence of the insured is far from the hospital, the expenditure incurred on transportation by the immediate family members, to reach the insured is compensated by the car insurance company.
• Child Education Benefit: The education expenses of the dependent children of the insured are covered in case of accidental death or permanent total disability under a personal accident insurance plan.

How to Claim Personal Accident Car Insurance Coverage?

Personal Accident Car Insurance policy can be claimed by the owner-driver or nominee of the respective four-wheeler. The policies aim that the nominee or the surviving owner fetches the maximum benefits. To retrieve benefits of the PA cover during an accident where the owner-driver has been injured, one needs to file a claim.

• Intimate the insurer about the incidence and resulting loss.
• Ask for an FIR followed by FR. It will be one of the most important documents needed for processing the claim.
• If possible, arrange for witnesses who can approve of the occurrence of a claim.
• Complete the formalities with the insurer that including filling the claim form provide photographs of the car accident.
• Submit all the documents online and wait for the insurers to verify the details.
• In the eventuality of death of the owner-driver, the nominee will file the claim. She/he will be awarded the claim amount as per the policy.

Documents Required For A Personal Accident Insurance Claim:

Following documents are required at the time of making a personal accident insurance claim:

• Death certificate
• Medical certificate
• Medicine bills
• Post-mortem report
• FIR report

What are the Reasons to Buy Compulsory Personal Accident Insurance?

• Accidental Risks Covered: Compulsory Personal Accident cover protects you against self-hazards caused due to an accident.
• Accidental death up to Rs. 15 lakhs: A person who dies due to an accident can shatter your loved ones, get a cover of Rs. 15 lakhs to support their future.
• Permanent disability up to Rs. 15 lakhs: In case of any disability from which you cannot recover, we pay up to Rs. 15 lakhs to support your finances.
• Zero Paperwork: With HDFC ERGO, take it easy! You can buy your policy online without any hassle with just a click.

What is Covered in Compulsory Personal Car Insurance?

• Relevancy: We cover you when you are driving or mounting/dismounting from your own vehicle.
• Full Sum Insured Paid: In an event of accidental death of owner-driver, the nominee gets 100% sum insured
• Lumpsum Payment: In an event of accidental death of the owner-driver while driving, the nominee gets lumpsum payment.
• 100% Sum Insured: In case the insured loses both limbs (arm or leg) or sight of both eyes or sight of one eye and one limb, we pay 100% of the sum insured.
• 50% Sum Insured: In case the insured loses sight of one eye or one limb, we provide 50% of the sum insured.
• Personal Disability Covered: In case of permanent disability we provide 100% sum insured.

What is Not Covered in Compulsory Personal Car Insurance?

• If death occurs while the insured is not driving will not be covered.
• Death or disability while driving under the influence of drugs/alcohol remains uncovered.
• Your car insurance goes out of action if you do not possess a valid driving license.

Personal Accident Cover for Owner/Driver:

The Car insurance plan offers coverage of a maximum amount of Rs. 2 lakh for the whole insurance term to the owner-driver of the vehicle in the event of death or body injury while traveling/mounting / dismounting the vehicle.

In India, it is mandatory for all cars owners to own a personal accident cover. This cover needs to be purchased irrespective of whether you are buying a third-party liability-only policy or comprehensive policy for your car. If you don’t own a PA cover under your car insurance, you will be liable for legal action under the law of the country.

Benefits of Personal Accident Cover for Owner-Driver:

• PA cover is the best protection option when it comes to securing yourself from any accidental injuries.
• If you meet with an accident while driving your car, it will provide you with financial aid to help you cover medical expenses incurred during your treatment, including hospitalization charges, treatment costs, and medical bills.
• It will also provide you with monetary compensation in case you end up suffering from a permanent disability as a result of the accident.
• PA cover will also provide compensation to the surviving members of your family in case the car accident results in your death.

FAQs of Personal Accident Cover:

Is it Mandatory to have a Personal Accident Covered with Insurance for a Car in India?

The Indian government mandates a Personal Accident Cover for all vehicle owners. India Motor Tariff 2002 has integrated the personal accident cover with car insurance policies. This means that the accident cover already forms a part of the liability-only policy as well as the comprehensive car insurance policy. This ensures protection for all owner-drivers against accidental losses. The absence of a personal accident cover can attract legal consequences.

How much is the Cost of Personal Accident Cover?

The premium amount you pay towards a personal accident cover is based on your occupation and age. Some of the insurance providers may even assess your medical history before quoting a premium. Your premium estimation is also subject to your choice of coverage. Tata AIG car insurance has various coverage plans under its insurance for cars. As the benefits and principal sum varies across the plans, so does the purchase price of the policy. The plan you opt for depends upon your requirements and budget. But your decision will eventually determine the premium.

Does insurance cover accidental death?

Yes, accidental death is covered by both life and personal accident insurance. Life insurance covers death from natural causes or accidents. But insurance of a four-wheeler only covers accidental deaths.

Does personal accident cover provide compensation to the surviving family members of the policyholder?

Yes, PA cover does provide compensation to the surviving family members if the policyholder dies in the accident.