How to Find the Best Personal Accident Insurance

With so many personal accident insurance options on the market, parsing through all of them to find the right one can feel overwhelming. However, finding the right policy will ensure that you will be protected in the event of a life-changing accident. Below, we discuss a few factors to consider when looking for a PA plan to help you find the best one for your needs.

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How Much PA Coverage Do You Need?

The amount of coverage you should choose depends primarily on your activity level and risk of getting into an accident. For instance, if you play contact sports often, ride a motorcycle or have a job where even a small disability (e.g. a broken finger) can put you out of work means you should consider getting a comprehensive PA policy. To find out the total sum assured, you should consider your family's current and future liabilities, such as debt payments, education and daily living expenses.

Furthermore, because PA plans have different scales of coverage for different disabilities, you should compare plans to find the one offering the highest payout for the injuries that you're most likely to face. For instance, while one insurer will offer up to 75% of the sum assured for burns, another will only offer 70% of the sum assured. If your health insurance policy doesn't cover accidents, you'll want to be careful to choose a plan that offers this type of coverage. To calculate the amount you'll need, you should consider treatment cost and your potentially lost income.

Average Cost of Common Treatment for Accident-related Injuries

Injury TypeAvg. Total Cost (B2 Ward)Avg. Total Cost (Private)
Injury to arm, shoulder, elbow, knee, leg or ankleS$891S$4,396
Head InjuryS$935S$4,269
Bone, joint, skin and soft tissue injuryS$932S$5,928
Skin TraumaS$778S$4,724

Choosing a Plan Based on Benefits

The most important benefits in a personal accident plan are the core benefits: accidental death, permanent disability and partial disability. If you do not have a life insurance policy, making sure you have a high accidental death and disability limit may be a good idea. Furthermore, it is important to make sure your plan covers temporary partial disability, especially because it's far more likely you'll suffer from a fracture in your lifetime than experience a completely debilitating injury. Essentially, your accident plan should be able to cover you regardless of accident severity.

Furthermore, a few insurers include a variety of benefits in their base plan, which can help you decide which plan is right for your lifestyle. For instance, if you worry about losing money while being out of work, a weekly income benefit can be an important benefit to have already included in your policy. This benefit will pay you up to your weekly salary income or the amount stated in your policy if you are unable to work due to your accident. A plan with a child benefit may be a good fit if you have children and want to make sure they have enough income for their education in the event that you pass away prematurely.

On the other hand, you may very well not need additional benefits. Instead, you may prefer a policy that offers the standard accidental death and disability coverage without any additional benefits, in exchange for a cheaper price. This type of plan may work for someone who is not the sole breadwinner, or who has benefits offered by his job that protect him from losing income.

Choosing a Plan Based on Your Lifestyle

Depending on your occupation, you may have a hard time getting a personal accident plan. This is because while most insurers cover low-risk occupations such as desk jobs and sales, many don't cover occupations that require manual labor or operating heavy machinery. These jobs are denoted as class 3 occupations and class 4 occupations. To circumvent this, you should choose the insurer that puts your job into a lower risk category, as this can save you money on your premiums.

If you are in a class 4 occupation, you have fewest number of insurers to choose from and you'll pay the highest premiums. In this case, the best plan for you would be which available plan offers the fewest restrictions on what you can claim for. For instance, construction work accidents may be covered, but only if you're working up to a certain construction height. Furthermore, you should also consider your budget. This is because coverage is already quite comprehensive out of the plans that do offer coverage for class 4 occupations, so your main differentiating factor will be price.

This graph shows the average cost of personal accident insurance based on occupation class, with class 1 occupations paying the least and class 4 paying the most

There are several things you should consider if you are approaching retirement and are interested in a personal accident plan. For instance, a suitable plan for seniors might include home modification and mobility aids/prosthetic benefits. This is because as you age, slips and falls can lead to serious injuries and these benefits reduce some of the cost associated with outfitting your home for easier mobility. You should also look for policies that will cover you well beyond retirement. While most policies terminate coverage at 75, others allow you to renew your plan into your 80's. Furthermore, a personal accident plan be a good alternative if a life insurance policy is too expensive or you don't have dependents that rely on you for income.

PA Plans Are Not Required, But They Can Help

Personal accident plans are optional. If you feel like you can do without one, it is your prerogative. However, if you do feel like you can benefit from the benefits offered in personal accident plans can add to a sense of security in your life, then they may be a good option to consider. As always, you should take into consideration your budget, financial obligations, coverage needs and current coverage before purchasing extra insurance. Furthermore, you should always read the terms and conditions to know what you're getting for your money and to reduce the likelihood of denied claims.

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