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The Importance of Personal Accident Cover Over Term Insurance

Whatever the type of insurance plan is, it’s an important tool for financial aspects, especially if there are dependent members of the family. Therefore, it’s crucial to purchase an insurance plan with good judgment and proper research. In most cases, people fail to discern the complicated clause of various policies and correspondingly so not understand the basic differences. Apart from this confusion, they are also doubtful when it comes to amplifying the coverage through investment in multiple policies. Let’s take a closer look at the primary differences between a term insurance plan and personal accident cover.

Defining Term Insurance

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A typical term insurance policy provides pure protection and is common with almost all life insurance companies. This plan provides coverage to an insured person for a particular period of time. A term plan generally has a duration of five, ten, twenty or thirty years. If the insured person passes away during the tenure of the policy, the compensation is offered to his/her family members in the form of a death benefit. This is how the insured secures the financial stability of the family even in the case of non-existent. The benefits of the policy are paid out to the nominee mentioned in the policy in the form of lump-sum amount or periodical payments.

How to Claim the Insurance

When the policyholder needs to file the claim, it is necessary to call the customer support number of the respective insurer and get in touch with the agent. You may also contact them through email or other contact platforms. In case you are unable to get across to the insurer, it is recommended to contact the HR of your company. Your claim will get registered with the insurer after the receipt of this information. When the registration is complete, the insurer will send you a form, along with a list of documents that will be necessary to make the claim successfully.

You may have to send the claim in the form of a hard copy once again if the documentation process is incomplete. According to the terms and conditions of the policy, the company will process the claim after receiving all the documents.

Personal Accident Cover

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Personal accident policy is a bit different from a typical life insurance cover or health insurance policy. However, most health insurance companies offer personal accident cover to the rider. This type of coverage is very gainful over the base plan and strengthens the financial strategies of a family. The insured person can also save a considerable amount of premium and achieve extended coverage in terms of the bargain. In the plan of personal accident cover, the life assured is protected from accidental injuries and death caused by mishaps. It is also a smart consideration for safeguarding an individual from financial loss due to the inability to work after an accident. Therefore, personal accident cover acts as an add-on benefit under motor insurance, health insurance, and other life insurance plans.

Difference between Term Insurance and Personal Accident Cover

Typical term insurance covers the insured person after a fatal accident or natural cause. But in the case of personal accident cover, an individual achieves benefits only in the case of death or permanent, temporary or partial permanent disability caused by accident. If the insured person experiences death due to natural reasons like illness, the incident will be not be counted under this policy.

Policy Benefits

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With personal accident cover, the life assured under the plan gets compensation even after he/she dies during the tenure of the policy. The insured person must remember that claims can be made only in the case of fatal injury, disability or death caused by an accident.

What is Covered in a Group Personal Accident Policy?

The terms and conditions of the policy determine the extent of coverage you will get when you hold a group personal accident coverage. Generally, the policies cover the following aspects:

  • Accident death: If an employee suffers an injury, resulting in death, the family of the person receives compensation from the insurance company.
  • Permanent total disability: In case an employee has an accident, resulting in a permanent disability that continues for 12 months or a longer time, the person gets a compensation, the amount of which is decided according to the terms of the policy.
  • Permanent partial disability: At times, employees suffering from injuries become partially disabled. Depending on the terms and conditions of the policy, the person can get 2% to 60% of the amount insured. However, these figures vary from one insurer to another.

Apart from these, the employee gets other benefits, as per the terms of the insurance scheme. You can buy the best personal accident insurance online, comparing the schemes designed by the reputed companies.


Younger customers are offered lower premiums under the clause of term insurance. However, the cost of the premium increase as the customer grows. On the flip side, the personal accident plan’s premium is depended on the profession of the insured and does not focus on age. The higher the risk in the profession the larger premium amount is required for personal accident cover.

Most private insurance companies offer higher coverage and wider benefits along with implementing higher premium rates. Therefore, you should choose the best company that does not bore a hole in your pocket and also cover your family with smart financial plans. Understand the terms and conditions properly before buying an insurance plan to achieve the utmost benefit. A personal accident cover should always be used as an add-on to fortify the financial situation of an individual. Find out more about personal accident insurance here.

About Michael Farmiga