Buy a policy which covers your accident insurance and hospitalisation at cost of an accident insurance

You are really lucky if you don’t have to travel by rail or road for work.

Besides escaping the daily grind of traveling in over-crowded trains and buses, you are also escaping the risk of meeting an accident or getting injured. But how many of us are amongst those lucky ones? Almost all of us travel long distance for work. In this article, I wish to share with you a traffic accident-cum-hospitalisation policy introduced by the National Insurance Company which is available at the cost of accident insurance.

This is a combination of personal accident insurance and health insurance policies, which covers risk of disabilities, death or hospitalisation due to traffic accidents. The policy is extremely a must for those who are on the road for a major part of the day, such as sales personnel, courier boys, office boys and drivers, who are generally unable to afford the costly health insurance policy or costly treatment. Besides, they are exposed to higher risk of meeting an accident than others who are in office during the major part of the day.

Eligibility, premium and basic features

Anyone who is between 5 and 70 can purchase this policy. The premium charged is a flat Rs 150 for an insurance cover of Rs 1 lakh irrespective of your age. The premium is inclusive of Goods and Service Tax (GST) for insurance cover for one year. Please note that this policy covers all the road accidents wherever it may happen. You have to appoint a nominee to receive the benefits under this policy in case of death due to accident at the time of purchase of the policy.  Please note that this policy only covers traffic accidents connected with road or rail transport but does not cover travel by sea or air prima facie but wording of the policy documents suggest that even one can claim under the policy if you are a bonafide passenger of the aircraft.

Accident insurance benefit 

Benefits available under this policy can be divided in two parts. The first part covers the benefits normally available under a personal accident insurance. Under this part, the insurance company pays Rs 1 lakh in case the insured person dies due to an accident. The same amount is paid in case the insured person suffers loss of two limbs or two eyes or one eye and one limb in an accident.

In case of loss of one eye or one limb, the policy pays 50% of the sum assured i.e. an amount of Rs 50,000. In case of permanent total disability the insurance company pays Rs 1 lakh. Though the policy’s nomenclature is “traffic accident policy”, it covers death / disability on 24 hour basis and is not limited only to accidents due to rail/road travel, but covers all types of accident as far as claim under this category is concerned.

Benefits of hospitalisation 

Under the second part, an insured person can claim reimbursement of medical expense incurred for treatment of bodily injuries as a direct result of a road or rail accident This covers expenses incurred for medical as well as surgical treatment in any nursing home or hospital upto Rs. 1 lakh. As the probability of getting hospitalised all of a sudden may arise only due to accident for the persons who are young and healthy, this policy is immensely beneficial for such persons.

Expenses incurred in OPD & ambulance 

Another unique feature about this policy is reimbursement of expenses incurred even without getting admitted in the hospital i.e. expenses incurred in Out Patient Department (OPD) department of a hospital. Normally, no health insurance policy covers expenses incurred in OPD. The amount covered for OPD under this policy is restricted to Rs 10,000 within the overall limit of Rs 1 lakh. This policy also reimburses reasonable expenses incurred on ambulance from the spot of accident to the hospital in case of road accident. In case the patient cannot be moved to the hospital or the patient cannot be admitted in a hospital due to lack of accommodation, domiciliary hospitalisation expenses are also covered.

Looking at the small cost of Rs. 150/- every year and the benefits offered, in my opinion, everyone should buy this policy. Since the premium is very small you will have to buy the policy for yourself from any of the branch of National Insurance Corporation. For the same reason you will have  to be vigilant enough to ensure timely renewal of the policy for continued benefits under this policy.

Balwant Jain is a tax and investment expert and can be reached on [email protected] or @jainbalwant his twitter handle.

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April 2021