Accident Insurance
Personal Accident Insurance:
Personal accident insurance is one of the popular classes of miscellaneous insurance and is a supplement to life insurance.it provides a better protection against death or disability.with the incresing industrialisaton and more use of accident-prone machineries, the industrial accidents have become more frequent. In order to meet the increasing requirments of this class of insurance, the insurance companies have come up with various forms of covers under personal insurance is concerned with the provision of compensation for loss occasioned by accidental bodily injury. Although, these policies are benefit policies, instead of contract of indemnity, because the loss is suffer if the insured persons are killed or disabled. Generally, these policies are issued for periods of 12 months but it can also be issued for less than 12 months.
Personal Accident Policy monetary compensation in case of death or disablement resulting from "accidental injury" as defined in the policy. Medical expenses incurred for treatment of injuries resulting out of such accidents are also reimbursed to a certain extent on payment of additional premium. An accidental injury is an injury, which arises out of accidental external, violent and visible means. The capital sum insured under this policy is the maximum amount the would become payable in case of a claim under the policy.In case of death,loss of two limbs,two eyes or one limb and one eye or permanent total disablement from injuries,the amount of policy is paid in full.In other case amount for compensation depends upon the extent to which injured sustained the injury.personal Accident insurance policy being a "Benefit" policy,there is no definite formula for the calculation of capital sum for individuals.However,the status of the person,his/her business or occupation and his/her annual income etc.are taken into account for fixing the appropriate ‘Capital sum’ insured.In case the policy includes temporary total disablement the captial sum insured is limited to 25 times the monthly income of the insured.But in all the cases 48-60 months salary may be taken as the basic for calculation of sum insured.
Age of Insured. Normally the cover of personal accident insurance is restricted to persons between the age of 5 to 70 years for both male and female. Cover beyond these age limits can be at a higher rate of premium as under:
- Renewal of policy above 70 years of age but upto 80 years is subject to loading of 5% on the premium.
- Fresh proposal above 70 years but below 80 years is subject to a loading of 10% on the premium.
- No medical examination is to be insisted for (a) and (b) above.