Disability insurance: Features and benefits of a personal accident cover
Investors India|December 2021
General Insurance
Ashwini Kumar Sharma

Accidents are accidental in nature and may occur at any place, anytime and with anyone. The outcome of an accident can be life threatening and could also result in broken bones or more fatally a damaged organ. It could be minor accident resulting in loss of income for the person over a considerable period of time once the doctor has advised a bed-rest. Not many of us are actually prepared to deal in such situations leading to loss of income from an accident or to tide over financially during disability arising out of accidents.

When it comes to risk protection, life and health insurance is what we generally focus on. Disability insurance, however, is highly ignored and gets the least attention. The insurance plans that cover disability arising out of accidents and even provide financial payouts to cover the loss of income are called the personal accident insurance plans or personal accident covers. Such plans also cover death arising in accidents. The ability to earn and sustain a regular income gets impacted due to disability. In situations when an accident occurs and if there death happens, a pure term life insurance plan would cover the risk of dying. If however, there is a survival with minor injuries requiring hospitalisation, a health insurance plan saves the day. However, if in the same accident the person survives but gets disabled and is unable to perform normal functions, the role of personal accident cover holds ground. Therefore, even if you hold a term insurance plan and a health insurance plan, holding a personal accident cover protects you with disability coverage.

Coverage of personal accident policy

An accident could result in death or leave the person with total or partial disability. Disability could be of certain organ, limb and even the extent may be different. Some of these disabilities could be permanent while others can be temporary.

A personal accident cover, therefore, typically covers four situations and on top of it offers several other add-ons available at extra cost. The four situations are - Accidental death, permanent total disablement, permanent partial disablement and temporary total disablement. On payment of additional premium one may add medical expenses too. The extent and nature of disablement under permanent and partial disability is defined but the extent of coverage varies across all insures. Features of personal accident cover

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