Hyderabad: Life is unpredictable, nobody knows what is in store for us. Especially accidents, we will never know when and in what form will happen. If we meet with a minor accident we will recover and attend to a job or business within a short period but if it is a major one there may be situations where the income stops for years as there is a chance of being confined to the house for months. Personal accident insurance policies are a financial stand when things like this happen. What is the need for these? Let's see what precautions should be taken in the selection of these policies.
In case of illness, health insurance pays the hospital expenses. But, when an accident occurs, the earning power is temporarily affected. Sometimes partial or permanent disability may result. This causes long-term financial problems. Personal Accident Insurance (PAC) is there to help you in case of such incidents. Many Add-ons can be added to this accident insurance policy. These mainly include accidental death, temporary/permanent disability and semi-permanent disability. A little extra premium is charged for these supplementary policies.
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Who is eligible?
A personal accident insurance policy is offered to people in the age group of 5 years to 70 years. As with life and health insurance policies, the premium does not change depending on age. All age groups have the same premium. However, the policy value and premium are determined by the income of the individuals and the list of risks they face.
Two types of personal accident policies
There are two types of personal accident insurance policies available. General Insurance companies offer this policy exclusively as a standalone policy. Life Insurance companies also offer this as a supplemental policy. The policy offered by General Insurance companies has to be renewed annually. A Life Insurance policy is a long-term contract when taken together.
Choose a comprehensive personal accident policy
Choosing a comprehensive personal accident insurance policy should always be preferred. The policy should be chosen to provide compensation in cases of accidental death, permanent total disability, permanent partial disability and temporary disability. In case of an accident and unable to go to work, there is an arrangement to pay a certain amount per week. It is determined based on the value of the policy. So, one should be careful in this regard while choosing the policy. It is very reassuring for low-income earners.
Policies based on income
The value of this policy depends on the discretion of the insurers. Depending on the income of the individuals, the maximum amount is decided. However, not all insurance companies follow the same rules. Some General Insurance companies offer accident insurance up to 72 times the monthly income of individuals. Some policies are worth up to five times the annual income. In some cases, they offer a maximum policy of Rs 50 lakhs. Insurance companies calculate the sum assured and premium based on the risks faced by the policyholder. Accident insurance policies offered by Life Insurance companies are up to 30 per cent of the basic policy. This policy is useful for income replacement in case of an accident. However, most insurance companies have imposed a limit of Rs 6,000 to Rs 10,000 per week. There will be a compensation arrangement of up to 104 weeks. This should be considered while taking the policy.
Personal accident insurance is a must
A personal accident insurance policy is a must for everyone. This policy is very necessary, especially for the working youth. Those who travel a lot should not forget this policy. Compared to a term policy.. the premium for an accident insurance policy is less. Along with a term policy, opting for this policy offers maximum protection at a low premium. Especially those who have taken loans.. should take this policy. In case of cessation of income, instalments can be paid with the proceeds of this policy.
