Personal Accident Cover with Motor Insurance Policies

Following the Motor Vehicles Act, 1988, it is mandatory for all vehicles to have at least a third-party motor insurance plan/policy to ply on the roads in India. A third-party motor insurance plan/policy offers cover for damages to the third-party involved in the accident. In this case, the policyholder or owner of the vehicle will not be covered. Keeping that in mind, it is important for vehicle owners to purchase a comprehensive insurance policy. The comprehensive insurance policy offers coverage to both the third party involved in the accident and the vehicle owner or the policyholder (first-party).

A comprehensive motor insurance policy offers coverage for damages met to both parties under various circumstances, ensuring the policyholder does not have to meet the financial expenses to pay for the damages from his/her own pocket. That said, a comprehensive motor insurance policy comes with various add-ons, which policyholders can purchase over and above the premium of their existing policy to enhance their protection.

One such add-on cover is a personal accident cover. If in case the policyholder is injured following an accident or the accident leads to death, the personal accident cover will cover the medical expenses and in the case of death, it will offer a death benefit to the nominee/dependent of the policyholder. Let’s look into the different aspects of the personal accident add-on cover.

Types of personal accident coverages

Listed below are some of the types of coverages that comes with the personal accident add-on cover:

• Temporary total disability cover

This type of cover offers coverage for medical expenses of the policyholder if he/she has succumbed to injuries following an accident requiring the injured person to take bed rest. The insured person is granted a weekly benefit for a specific tenure as mentioned in the policy.

• Permanent total disability cover

If the policyholder meets with an accident leading to complete and permanent disability, then the policyholder is liable to the entire sum assured as agreed upon when purchasing the personal accident add-on cover.

• Permanent partial disability cover

If the insured person meets with an accident leading to partial but permanent disability, then the policyholder is paid a certain percentage of the sum assured. The percentage of the sum assured to be paid to the policyholder depends on the type of disability suffered by the policyholder.

• Education cover

Offered by some motor insurance companies across India, in case of the death of the policyholder following an accident, then the children/dependents are offered coverage for educational expenses for a specified period, based on the terms and conditions of the policy.

• Death coverage

If an accident leads to the death of the policyholder or the insured person, then the entire sum assured is paid to the dependents or nominees of the policyholder.

• Mortal remains transportation cover

An option with a few motor insurance policies, if the policyholder meets with an accident leading to death, then this coverage takes care of the expenses to transport the mortal remains of the policyholder.

• Accident hospitalisation cover

If the policyholder or the insured person requires hospitalisation following an accident, then this cover offers coverage of medical expenses when hospitalised for a certain period.

All the above-mentioned coverages under the personal accident add-on cover are subject to the exclusions as listed by the insurance company. For example, if death or disability is caused following an accident in which the policyholder was under the influence of drugs or alcohol (as listed in the exclusions), then no coverage will be offered to the policyholder. In short, if an eventuality involving the policyholder is caused as a result of any of the circumstances as listed in the exclusion list of the insurance company, then no coverage will be offered as per the terms and conditions of the policy.

Benefits of a personal accident cover

Listed below are some of the key benefits of a personal accident add-on cover:

• A personal accident motor insurance cover offers financial protection in the case of an accident leading to injury, temporary, or permanent disability. If death occurs following an accident, then the sum assured of the policy is paid to the beneficiary or nominee of the policyholder.
• The personal accident cover offers coverage for small or minor injuries as well.
• The personal accident add-on cover with a motor insurance policy is relatively affordable as compared to purchasing an independent policy for this reason. That said, with regard to independent personal accident insurance policies, the policyholder is offered a bigger sum assured and the premiums are higher as well.
• Offers sufficient financial protection for the nominees or the beneficiaries of the policy.

Personal Accident Cover FAQs

1. Do all motor insurance policies come with a personal accident cover?

Yes, you will have the option of purchasing a personal accident cover along with your regular motor insurance policy. That said, the personal accident cover is an add-on cover and is not inclusive with a regular motor insurance policy.

2. Do I have to pay extra for a personal accident cover?

Yes, since the personal accident cover is an add-on cover, you will have to pay for it over the premium price of the regular motor insurance policy that you have availed.

3. If death occurs due to a natural calamity, will the nominee or beneficiary of the policyholder receive a compensation or the entire sum assured of the add-on cover?

For most insurance companies, death as a result of a natural calamity comes under the exclusion list, meaning no coverage will be offered in this case. If it is mentioned by the insurer on the exclusion list, then no benefit will be paid to the nominee or beneficiary.

4. Can I buy the personal accident cover when purchasing a motor insurance policy?

Yes, it would be ideal to purchase the personal accident add-on cover when purchasing a motor insurance policy. You can also purchase the add-on cover when renewing your motor insurance policy.

5. What’s the first step that should be taken following an accident?

If the insured person does meet with an accident, then the first step is to intimate the insurer of the accident. The insurance agent will make an initial investigation of the case and then guide you through the whole process of making a claim to cover expenses.