Page 179 - IC38 GENERAL INSURANCE

N. Personal Accident and disability cover

A Personal Accident (PA) Cover provides compensation due to death and
disability in the event of unforeseen accident. Often these policies provide
some form of medical cover along with the accident benefit.

In a PA policy, while the death benefit is payment of 100% of the sum insured,
in the event of disability, compensation varies from a fixed percentage of the
sum insured in the case of permanent disability to weekly compensation for
temporary disablement.

Weekly compensation means payment of a fixed sum per week of disablement
subject to a maximum limit in terms of number of weeks for which the
compensation would be payable.

1. Types of disability covered

Types of disability which are normally covered under the policy are:

i. Permanent total disability (PTD): means becoming totally disabled for
lifetime viz. paralysis of all four limbs, comatose condition, loss of both
eyes/ both hands/ both limbs or one hand and one eye or one eye and
one leg or one hand and one leg,

ii. Permanent partial disability (PPD): means becoming partially disabled
for lifetime viz. loss of fingers, toes, phalanges etc.

iii. Temporary total disability (TTD): means becoming totally disabled for a
temporary period of time. This section of cover is intended to cover the
loss of income during the disability period.

The client has choice to select only death cover or death plus permanent
disablement of Or Death plus permanent disablement and also temporary
total disablement.

2. Sum insured

Sums insured for PA policies are usually decided on the basis of gross monthly
income. Typically, it is 60 times of the gross monthly income. However, some
insurers also offer on fixed plan basis without considering the income level. In
such policies sum insured for each section of cover varies as per the plan opted.

3. Benefit plan

Being a benefit plan, PA policies do not attract contribution. Thus, if a person
has more than one policy with different insurers, in the event of accidental
death, PTD or PPD, claims would be paid under all the policies.

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