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Why should I buy personal accident policy, when I have a health insurance policy and a Term policy? Many are asking this question to themselves when they read about personal accident policy. These policies are different and offer different benefits at a low cost.

India is the accident capital of the world, with a person dying every 90 seconds. But the number of persons injured in accidents is much more than this number. Most accident victims are young. An accident can stop your further income and you may be living at the mercy of your dependants! There is a need for personal accident policy to cover such mishaps.

Personal Accident Policy

What are the benefits under personal accident policy?

The basic personal accident policy covers accidental death only.  But you can opt for cover against disability also. So, the cover is available in the following situations due to accident.

  1. Accidental Death – full sum assured will be payable to the nominee.
  2. Permanent total disability – full sum assured will be payable.
  3. Permanent partial disability – benefit will be ranging from 5% to 75% of the sum assured depending on the extent of disability.
  4. Temporary total disability – Weekly allowance of 1% of the sum assured till the disability prevents policy holder from resuming work, but capped at 52 weeks or 100 weeks as per the policy conditions.

How the premium is calculated in personal accident policy?

In personal accident policy, premium is calculated based on your nature of job. If you are working in a high risk industry, the premium can be higher. The premium for this policy is relatively low. If you are working in a low risk industry, you can buy a 10 lakhs policy by paying an annual premium of around 1500.

Options available

You can buy personal accident policy either as a rider to other policies or as a standalone policy. A standalone policy offers better coverage compared to the rider. PSU general insurance companies offer low premium but private players offer better coverage. You can buy them online at a better price.

Why critical illness policies?

Critical illness as the very name indicates is that illness which needs immediate medical attention. In medical terminology it is that illness which, many times lead to severe deterioration of health.  Diseases like Heart attack, Cancer, stroke come in this category. Such illness affect the physical health first and then the financial health.  The treatment cost is very high with modern treatment facilities. In some cases, such illness may not require 24 hours hospitalisation. In such cases, the health insurance will not cover the treatment cost.

What are the benefits under critical illness policy?

In this policy, the benefits are payable once the policy holder is diagnosed with any of the critical illnesses covered under the policy. After the pay out of the sum assured, the policy is cancelled. There are certain diseases covered under the policy as per the policy conditions. This list may change from policy to policy. You may check the details and opt for a policy which covers the maximum disease. The following illnesses are covered in most of the policies.

  1. Coronary artery Bypass surgery
  2. Myocardial Infarction
  3. Cancer
  4. Kidney Failure
  5. Major Organ transplant
  6. Stroke
  7. Multiple sclerosis
  8. Paralysis
  9.  Pulmonary Arterial hypertension

There are certain conditions to get benefit from the critical illness policies. Usually pre existing diseases are not covered under the policy.  There is a cooling period of first 90 days, within which no claim will be entertained. The policy holder has to survive for certain days after the diagnosis to claim the benefit. In most policies, it is 30days.

Why should I buy critical illness policy because I have a health insurance policy?

The health insurance policy will take care of the actual treatment cost in the hospital. But a critical illness policy will give you the lump sum amount, once you are diagnosed with the critical illnesses and survive for 30 days. This policy can help you in managing your personal finance, if you are not working for few months after the disease.

You can buy this policy as a rider along with other policies or as a standalone policy. Stand alone policies cover more diseases and are better. The premium paid for such policies can be claimed for tax benefits under section 80D within the 15,000 limit per year.

India is the diabetic capital of the world. Soon it is becoming the capital of cardiac diseases. The incidence of cancer is increasing day by day. Life style, lack of physical exercises, stress etc are contributing to such diseases.

Going for a critical illness policy, Personal accident policy along with a health insurance policy will reduce your stress in case of any unfortunate event. The amount spends for such policy is really worth when compared to the benefits it offer.

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