The Gujarat bridge collapse is in the news, as several women and children on the nearly 150-year-old bridge tumbled into the river. Images of people swaying wildly on the bridge, trying to hold the cables on both sides, and later falling over each other when the bridge crashed into river Macchu are all over the print and electronic media.
The bridge collapse has brought back haunting memories of other disasters, such as the Bengaluru floods, in recent times and reminds us how vulnerable we are to nature. While we cannot do much about such a catastrophe, we could minimise the economic loss caused by buying a proper accident insurance policy.
An accident is defined as an unfortunate incident that happens unexpectedly. It can lead to minor or serious injuries and, in case of a severe injury, can lead to a break in employment and a financial crisis. Most of us are covered by life insurance, but a life personal accident insurance policy makes any payment if an accident causes temporary or permanent disability, not death.
Here is where a personal accident policy comes in. A personal accident policy provides coverage both against disability and accidental death.
Coverage Against Disability
There are different types of disability coverage available under a personal accident policy. Personal accident policy covers permanent partial disability leading to permanent loss of a particular body part like an eye, an arm, etc., where a certain percentage of the sum insured is paid depending on the loss of the normal functioning of the body part. Such a payout is made when the partial disability is beyond the scope of medicine to be healed. The payouts will be mentioned in the policy guidelines.
Permanent total disability is one where the person can no longer work due to sustained injuries for which a certain percentage of the sum insured is paid. Such a disability is beyond the ability of medicines to heal. Even if the disability was not prominent at the time of the accident but arises due to the accident within a year of the occurrence, the benefits will be paid out as a lump sum.
In temporary total disability, if a person cannot carry out daily activities temporarily for a few days/weeks, weekly benefits are paid per policy terms and conditions. Under this, an individual may be temporarily disabled because of an accident. Such a disability can be restored through medication or treatment, and the insured can return to their original working capacity.
A personal accident policy can make up for the loss of income in such cases and provide a fixed payout for a certain number of months, thus helping a family go through a tough time when the breadwinner is unable to work. "Some common exclusions are injury caused due to suicide, under the influence of alcohol or drugs, or any kind of pre-existing disabilities, etc.," says a leading general insurer.
Coverage Against Death
Accidental death can devastate a family both emotionally and financially. Death within 12 months caused by an external, violent, visible, and evident means, verified and certified by a medical practitioner, is also covered under a personal accident policy. In case of accidental death, the nominee is paid 100 per cent of the sum assured. Here, it is essential to note that a life insurance policy will also pay the sum assured in case of accidental death, while a personal accident policy will not make a payment in case of natural death.
Ensuring Continuity Of Child's Education
A personal accident policy also ensures that the insured child's education is not affected in case of their demise. The coverage could be 10 per cent of the sum assured or the tuition fees the institution charges, whichever is lower, which is a feature of the policy. Personal accident policy also covers required home modifications, like installing a wheelchair ramp in case of disability or even changes to your car to make it disabled-friendly.