A personal accident cover in a car insurance policy is an add-on security for your personal life when in an accident. It is a common occurrence that in vehicle accidents, victims are left injured for a long time. Although the car insurance policy typically takes care of the vehicle post an accident, unless you have a medical or life insurance policy, you are left totally helpless.
What is personal accident cover?
A personal accident cover is often included in a vehicle insurance as an add-on. This rider offers protection to the owner or the driver if he or she is employed. The policyholder can claim 100% depending on the sum assured in case the accident leads to permanent loss of his or her arms or legs. In case of death of the policyholder, the nominee is entitled to make a 100% claim. However, if the driver or the owner does not have a valid driving license, no claim amount is payable. In case the owner has multiple vehicles, the add-on is applicable only for one vehicle towards which the insurance has been taken.
Some insurers offer tax-free compensations in case of death of the insured or if he or she succumbs to serious injuries. The amount can be paid in installments or as lump sum. However, there are certain considerations at the time of policy claim. Policyholders get a higher amount in case of more serious injuries.
Features of personal accident cover in car insurance:
Given below are some of the features covered under the personal accident cover:
- Permanent total disability cover – In case of an accident leading to permanent total disability of the insured, the company is liable to pay the entire sum insured to the person.
- Permanent partial disability cover – If an accident results in a permanent partial disability cover, the insurer provides a certain percentage of the sum assured to the policyholder. The pay depends on the extent of disability.
- Temporary total disability cover – If a policyholder succumbs to injuries due to a car accident resulting in home confinement, the insurer provides a weekly benefit for a specific period.
- Death cover – In case of death of the policyholder as a result of a vehicular accident, the entire sum insured is paid to the nominee.
- Accident hospitalisation cover – In case of a vehicular accident, policyholder can opt for a personal accident cover that will look after hospitalisation overheads.
- Transportation of mortal remains – In case of death caused by a car accident, the insurer pays the nominee of the policyholder a certain amount for the purpose of transporting mortal remains.
- Education grant – Sometimes the cover also includes an education grant that covers the education of dependent children of the policyholder in case of his or her death in an accident. However, it depends on the terms and conditions of the policy.
Advantages of personal accident cover in car insurance:
There are many advantages and benefits under the personal accident cover, they are:
- This cover offers financial assistance at the time of an accident.
- Under this cover, policyholders can avail compensation in case of minor injuries as well. Private insurance companies have policies with higher cover and greater benefits, however premium rates are higher too.
- Some policies also offer additional protection for temporary and partial disability, and even loss of livelihood, apart from death and permanent disability cover.
Having a car insurance prepares you for the worst in case of a car accident, however personal accident cover gives that additional security and covers you for injuries and any unexpected costs.
GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017