Compulsory Personal Accident Cover in Car Insurance

Road accidents don’t come announced at our doorstep. Such mishaps are unpredictable and not only lead to severe vehicular damage but also bodily injuries and sometimes permanent disability or even death. Falling prey to such unwanted accidents not only creates an unplanned financial burden for us but also leads to emotional and stressful driving.

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Personal accident insurance cover in car insurance comes to your rescue here and keeps you covered from accidents as the owner-driver. Keep reading to learn more about a personal accident cover in car insurance and how you can make the most out of it. 

What is a Compulsory Personal Accident (CPA) Cover? 

As the name suggests, a compulsory accident cover is personal accident insurance for the owner-driver that is provided with a car insurance policy. Whether you are buying third-party insurance or a comprehensive car insurance plan, a personal accident cover is provided.

It can also be purchased as an extension with an existing car policy and is issued to the owner-driver. Under this cover, you will be entitled to monetary compensation up to Rs 15 lakh from your insurer if you face any bodily damage or injuries in an accident. Please note that you would need to hold a valid driving license if you want to be eligible for compensation under this cover

Is it Important to Have a Personal Accident Cover?

Situations on the road are unpredictable. Mishaps can occur in the blink of an eye without even you seeing them coming. Such mishaps on the road not only lead to severe damage to vehicles but also lead to bodily damage to individuals in the car. 

While third-party car insurance and comprehensive car insurance policies cover third-party bodily damages, injuries as well as vehicular damage, they do not provide coverage for the owner-driver, making them vulnerable in such circumstances. 

Such life-threatening mishaps cannot be denied, nor can their probability be predicted. The best way here is to always be prepared and keep yourself covered in such cases. Hence, it becomes crucial to buy personal accident insurance. This car policy serves as a vital instrument giving the owner-driver maximum financial assistance in case of an accident on the road. 

What is Covered under Personal Accident Cover?

As per the guidelines of IRDAI, a personal accident cover under a car insurance policy provides for monetary compensation up to Rs15 lakh in case of bodily damage or injuries, permanent disability, or even death of the insured owner-driver. Let's have an in-depth look at the percentage of compensation paid by the insurance company under various situations:

  • Accidental death: The insurer will compensate the entire sum insured to the nominee of the deceased in case of sudden death in a road accident
  • Permanent disability: Under this situation, the compensation paid is as follows –

Situation type

Compensation provided (%)



Loss of 2 limbs or 2 eyes or 1 limb or 1 eye


Loss of sight of 1 eye or 1 limb


Permanent disability


Benefits of Personal Accident Cover?

Personal accident cover comes with the following benefits:

1. Financial compensation to the insured for loss of income due to permanent disability in the accident

2. Financial compensation to the insured for expenses arising out of medical treatments

3. Additionally, a personal accident cover also benefits the surviving members of the deceased 

Is it Mandatory to Have a Personal Accident Cover?

Initially, as per the Motor Vehicles Act, 1988, the only document that was mandatorily required to be carried was third-party car insurance. However, since car ownership has increased in India leading to a higher number of claims for bodily injuries being reported. 

Apart from this, the only left-out cases were injuries sustained by owner-drivers that required. This intention led to personal accident covers being made mandatory to be bought along with a car insurance policy. 

However, the Motor Vehicles Amendment Act, 2019 has slightly amended this rule of compulsorily buying a personal accident cover with the following 2 noteworthy changes:

1. If the owner-driver already possesses a stand-alone accident plan with an insured sum up to Rs 15 lakh, then they will not be required to buy this additional cover

2. In case the owner-driver has an existing vehicle and already carries a personal accident cover along with their insurance policy, they will not be required to buy it again for a new vehicle

Changes Made to Personal Accident Cover

With the Motor Vehicles Amendment Act, 2019, a lot of changes have been made to personal accident insurance. Following are some of the changes to be kept in mind:

  • Sum Insured has been increased to Rs 15 lakh for all types of vehicles from the previous Rs 1 lakh for 2-wheelers and Rs 2 lakh for 4-wheelers
  • The amount of personal accident cover for owner-driver for 1 year has been increased to Rs 331 excluding GST from the previous Rs 50 for 2-wheelers and Rs 100 for cars. This is due to the increase in the total sum insured.
  • Vehicles owned by private companies or organizations cannot opt for personal accident insurance, hence, are not required to pay an additional premium amount while buying car insurance for the vehicle.
  • In case a person owns more than 1 vehicle, they will only be required to pay a premium amount for PA cover for only that vehicle even if they buy another vehicle.

To Conclude

Humans are always on the lookout to be prepared for danger, especially unpredictable events such as making an action plan as well as following regular disaster management drills for unforeseen earthquakes or buying car insurance. Driving on the road also involves the probability of unforeseen mishaps coming at our way without notice. 

This calls for keeping ourselves alert as well as prepared every time we go out driving on the road. Make sure that you periodically renew car insurance online and keep it valid so that you can drive on the road stress-free and also keep yourself protected from unforeseen mishaps.

Written By: PolicyBazaar - Updated: 12 October 2021
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