IRDAI Mandates General & Health Insurers to Offer Standard Personal Accident Insurance from April 1, 2021

A personal accident insurance policy provides coverage for the uncertain accidental death, accidental body injury and partial/total disabilities, permanent from an accident. Since there are many personal accident plans including group personal accident policy available in the market and each plan has its separate set of features and this makes it a challenge for the buyer to choose the right plan. To overcome this situation, a standard personal accident insurance plan is set to release in 2021.

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The insurance regulatory and development authority of India has made it mandatory for the general and health insurance providers to offer a standard personal accident insurance plan starting from April 1, 2021. It is going to be a standard personal accident plan that will provide common coverage.

As per some of the insurance industry experts, all general and health insurance providers should offer basic protection against death, permanent or partial disablement due to accidents.

For example: If you are a general or health insurance policyholder, then after the release of this product you’ll be able to raise a claim for any accidental damage done even if you do not have a separate personal accident insurance plan.

Let us also tell you about some of the features that this additional insurance plan will carry.

Standard Coverage

This additional standard personal accident insurance plan will protect you against death, permanent or partial disablement due to accidents. The policy tenure will be for one year only. It will also cover the hospitalization expenses. The buyer would not have to purchase it separately that is why it is expected to offer some common features of a personal accident insurance plan.

Sum Insured

As per the guidelines issued by IRDAI, the minimum sum insured under the standard policy will be Rs. 2.5 lakh and maximum Rs. 1 Crore. Only people aged between 18-70 years will be eligible to purchase this plan and this can be offered as a family cover too. Apart from this, if all the terms and conditions remain same, the insurer can use the same name for the product.

Increment in SI

The sum insured is expected to increase by 5% if you don’t raise a claim in one year and renew the policy without a break that will be subject to a maximum of 50% of the SI. If you raise a claim in a year, the cumulative bonus generated might get reduced at the same rate it has accrued.

Basic Benefits

In the standard personal accident policy, if the insured raises an admissible claim for death or permanent total disability, “One-time educational grant of 10% of the basic sum insured will be payable and maximum two dependent children of the policyholder. It will only be payable if the child is studying in school or pursuing a full-time course. Also, the child should not be older than 25 years.

The policyholder can also get benefits equal to 100% of the sum insured in case of permanent total disablement. It will also be subject to certain terms and conditions.

There will also be some optional add-ons. Let’s take a look at that.

Optional Add-ons

There will be optional add-ons available that you can purchase by paying an extra premium. According to the industry experts, there will be an add-on option for temporary total disablement. Under this cover, you will be able to get compensation at the rate of 1% of the sum insured per week. It will be allowed only until you return to your workplace or up to 100 weeks, whichever comes first.

Depending on the actual expense incurred out of your pocket will be covered under it, if you purchase this add-on cover. Only 10% of the sum insured will be payable.

A termed educational grant will be offered as an optional cover. Subject to conditions.

Personal Accident Claim

According to the base cover, if the insured dies then a benefit equal to 100% of th SI will be payable. On a condition, if the insured person dies with 12 months due to the injury sustained in an accident during the policy tenure.

Why is it Included with General & Health Insurance?

If you are a general and health insurance policyholder and meet an accident and sustain a partial or permanent disablement that is not covered under your policy. This inclusion with basic features will provide you cover for those unexpected accidents that could harm you physically and disable you partially or permanently. Also, it will be payable up to 100% in case of insured sudden demise. Subject to conditions.

Concluding here!

This will help the general and health insurance policyholders who cannot purchase a personal accident insurance plan separately. If you are looking for comprehensive coverage then you can always go for a separate personal accident insurance policy to avail maximum benefits. It is advised to always purchase an insurance policy online to understand a policy properly and get discounts and offers provided by the hundreds of insurers online.

Written By: PolicyBazaar - Updated: 18 August 2021