Accidents happen, but some can be more serious than others, and it’s important to have a plan to cope with what happens next. Personal Accident Cover can help offer you financial assistance in case of an unfortunate incident.

Personal Accident Cover in Car Insurance - Acko

As per the Insurance Regulatory and Development Authority of India (IRDAI), if you purchase a car or bike insurance policy, a Personal Accident Insurance Cover of Rs.15 lakh is mandatory, if you do not have an existing cover. This policy protects you from financial liabilities in case of disability or death arising out of a motor accident.

What is Personal Accident Cover in Car Insurance:

As the name suggests, Personal Accident (PA) Car Insurance protects you against the risk of physical disability or death due to an accident. The cover is offered along with vehicle insurance similar to general insurance that offers financial compensation. 

Accidents might leave you permanently disabled, leaving a heavy burden due to medical and financial expenses. This personal accident coverage offers you the peace of mind about these expenses. And, in case of death, the nominee mentioned in the policy shall receive 100% compensation.

Personal Accident Insurance Coverage:

Under Acko Personal Accident Cover you can avail the below coverage benefits:

  • Permanent Total Disability: You are entitled to receive the entire sum insured in case of total disability. This is paid to the insured due to an unfortunate incident.
  • Accidental Death: The entire insured amount is paid to the nominee of the insured individual in case of an unfortunate event of death.

Under these circumstances, Acko undertakes to pay the compensation as per the below scale for death or bodily injuries sustained by the owner-driver of the car:

Nature of Injury Scale of Compensation
Death 100%
Loss of two limbs/loss of both eyesight/loss of one limb and one eyesight 100%
Loss of one limb/loss of one eyesight 50%
Permanent total disablement from injuries other than mentioned above 100%

Why You Need Personal Accident Cover:

You may decide to opt for a personal insurance cover due to an unfortunate accident because you travel or work in a particularly risky environment. And, you may even find it challenging to make ends meet if you are unable to work due to injuries. A PA cover is a precautionary measure for you and your family and stays secure in case of financial instability. Certainly, a personal insurance policy can be useful for anyone.

Personal Accident Policy Claim Eligibility:

Compensation under this policy shall be payable directly to the insured or his/her legal representatives. This cover is subject to the below conditions that the owner-driver is:

  • The registered owner of the vehicle insured.
  • The insured named in this insurance policy.
  • A holder of a valid driving license listed under the provisions of Rule 3 of the Central Motor Vehicles Rules.

Personal Accident Insurance Cover Premium Rate:

The IRDAI, through a circular dated 20 September 2018, announced to increase the Compulsory Personal Accident Cover (CPA) to Rs.15 lakh. The authority also fixed the premium rate of PA cover at Rs.750 p.a. Earlier, the CPA for two-wheelers was fixed at Rs.1 lakh and for four-wheelers, it was Rs.2 lakh.

However, if you want to increase the sum insured with an additional premium, which ranges between Rs.300 and Rs.1,000.

This depends on the model of the car, age, where you stay, whether your existing insurance has expired or not, and the Insured’s Declared Value (IDV) of your vehicle. Also, if you have utilised the No-Claim Bonus (NCB) offered on the existing policy.

Personal Accident Cover Add-Ons:

Apart from your insurance cover, you can take advantage of the Add-ons, they are:

  • PA Cover for Paid Drivers, Cleaners and Conductors: With an additional premium, the insurer undertakes to pay compensation for bodily injury suffered by the paid driver/conductor/cleaner who is employed by you and the claim is of the insured vehicle.
  • PA Cover for Unnamed Passengers other than the person insured and the Paid Driver and Cleaner: By paying an additional premium, the insurer undertakes to pay the compensation for bodily injuries sustained by the passenger other than you and/or the paid driver/cleaner/a person employed.

Check: 3 Reasons Why A Third-party Car Insurance Is Not Enough

Benefits of Buying Personal Accident Insurance along with Car Insurance:

There are several benefits and advantages under this insurance cover, they are:

  • Financial assistance in the event of an unfortunate accident.
  • For an additional premium, unnamed passengers other than the insured, the insurer pays compensation similar to the primary policyholder.
  • Also, paid drivers or cleaners or conductors employed by you can be eligible for compensation with the payment of an additional premium and the compensation is similar to the insured.

What is Covered Under the Personal Accident Insurance:

As mentioned, the policy covers accidental death and permanent total disability, such as:

  • In the event of accidental death of the owner-driver, the nominee shall receive 100% of the sum insured.
  • In case of permanent disability, the insured shall receive 100% of the sum insured.
  • If the owner-driver loses both limbs/sight of both eyes/sight of one eye and one limb, the insured shall receive 100% of the sum insured.
  • If the owner-driver loses sight of one limb/one eye, the insured shall receive 50% of the sum insured.
  • With additional premium, the insured shall receive the sum insured for your paid driver/cleaner/conductor as well as unnamed passengers.

What is Not Covered Under the Personal Accident Insurance:

Under this insurance policy, the following are not covered:

  • Self-harming activities.
  • Death/disabilities in case of intoxication.
  • Death/disabilities arising out of illegal activities.
  • Death/disabilities during pregnancy or childbirth.
  • Death/disabilities arising out of adventure activities.
  • Death/disabilities due to war.
  • Pre-existing injuries.
  • Death/disabilities caused, sustained, or incurred outside the geographical area.
  • Death/disabilities directly or indirectly caused .

FAQs:

What is the total compensation under the Personal Accident Cover in Car Insurance?

The Insurance Regulatory and Development Authority of India (IRDAI) has mandated a PA cover of Rs.15 lakh for individuals buying motor insurance.

Do I have to Apply for a Different Personal Accident Policy if I have more than One Vehicle?

You need not opt for accident insurance cover in all vehicles, just one policy is required as per the recent mandate announced by the IRDAI.

Are there any Add-Ons for this type of insurance cover?

Yes, you can take advantage of Add-ons such as coverage for your paid driver/cleaner/conductor as well as unnamed passengers. However, you’ll have to pay an additional premium for the Add-ons.

What are the documents or information required to file a claim?

While claiming the sum insured in case of an unfortunate event, below are the required documents – which are case-specific – and information required to process your claim:
1. Policy number.
2. Name and contact number of the insured.
3. Date and time of the accident.
4. Location of the accident.
5. Description of the incident occurred and the extent of the loss.
6. Death and post-mortem certificate.
7. First Information Report (FIR).
8. Medical reports and hospitalisation bills.

Can I Continue to Hold my Existing PA Insurance Policy and Opt for a Separate Vehicle Insurance?

Yes, you can continue with your existing insurance company or you may opt for a better alternative based on your requirement while you choose separate car insurance as a standalone PA cover.

Why was the Motor Insurance Unbundled by the IRDAI to Not Include PA insurance cover part of the Vehicle Insurance?

The IRDAI, in a statement, announced that it had received feedback from several quarters that various owner-drivers have an existing PA cover and if there’s a need to take an additional PA while purchasing a new vehicle. To address this issue, it unbundled vehicle insurance from the PA insurance cover.
Also, it said that the fact owner-drivers may own more than one car needs to be taken into consideration so that the owner-driver does not have to take several PA insurance cover for each of his vehicles.

Is it Mandatory to opt for Long-Term PA Insurance Cover?

It’s not mandatory to opt for a long-term PA cover and it’s your choice to opt for the one-year Compulsory Personal Accident (CPA) cover or the long-term CPA if you do not have one in place.

Is the Sum Insured Capped at Rs.15 Lakh?

While the minimum has been raised from Rs.1 lakh / Rs.2 lakh, as the case may be, to Rs.15 lakh by the IRDAI for vehicles , you can opt for a higher than Rs. 15 lakhs insured amount in multiples of Rs.1 lakh or Rs.5 lakh with additional premium.

Has the IRDAI fixed the Personal Insurance Cover Premium rate for the Rs.15 Lakh?

Yes, the IRDAI has fixed the premium rate at Rs.750 p.a for a cover of Rs.15 lakh for both four-wheelers and two-wheelers.

Can I Claim Tax Benefits Under the PA Cover?

Unlike life or health insurance, PA insurance does not have any tax benefits under the Income Tax Act.


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