Unfortunately, accidents happen when you least expect them. Even with health insurance, the extra expenses from an accidental injury can really add up. Lost wages from missing work, high health insurance deductibles and unpaid bills all can adversely impact your lives, home and family. And because 57% of Americans have less than $1,000 In their savings accounts, many don’t have financial help during times like these.
With personal accident insurance ( personal accident coverage, or individual accident insurance, or injury insurance) you pay a monthly premium that usually remains the same as long as you maintain the policy. You will receive a cash benefit if you have an accident or receive a serious injury during the policy term. This benefit can be used for any expenses, and will help ensure that your family is provided for even if you are unable to work.
What is Accident Insurance?
Accident insurance protects you financially in the event of an injury from an accident. Accident insurance will generally cover you in the form of a lump sum to offset the burden of medical bills and other expenses related to your injury.
A few of the reasons to consider this form of coverage are:
- Peace of mind. If you stay physically active throughout the year, it may be a good idea to have extra coverage in place in case of an accident.
- Low cost. A policy can be as little as $15 a month depending on factors like where you live, your age and how much you coverage you’d like.
- Covers additional expenses caused by an injury such as rehab and what is not covered by your health insurance
- Your personal savings are low. If you suffer an accident and you are unable to work, your policy can provide financial relief and assistance.
- Protection until you retire. You can choose different term lengths that can cover you until you’re ready to retire so you don’t have to dip into your retirement savings and investments.
- Self employed or employed on a casual or contract basis: You may not have sick leave if you’re self employed but accident insurance could protect your finances.
- No medical underwriting to take out standalone coverage. This is an option for applicants that have been previously declined life insurance.
What does accident insurance cover?
- Hospital Emergency Room
- Physical Therapy
- Urgent Care Center
Out-of-Pocket Cost and Non-Medical Expenses That Accident Insurance Covers:
- Lost wages
- Rent or mortgage
- Car payments
- Child care
You’re covered if you get into an accident that leaves you either:
- Unable to work
- With a defined injury (on some policies)
How is accident insurance paid?
A lump sum payment or a monthly cash benefit to supplement the income you’re missing from being injured.
What are the benefits of having accident insurance?
- You choose how your benefit is paid, either as a lump sum payout to help with upfront medical expenses or paid as an ongoing monthly income to help with your living expenses.
- Disability benefit: Most personal accident insurance policies will include a payout for disability. For example, if you suffer a total loss of hearing or sight or the loss of the use of a limb, you are considered to be eligible for a total and permanent disability benefit.
- Premiums are tax deductible, as long as you pay the total cost of the premium out of pocket.
- Associated accident costs: There are many incidental costs involved, and a personal accident insurance policy can provide a benefit payout to cover: counselling, rehab, damage to clothing or personal property, and transportation costs (eg specialized vehicle) required to get you to the hospital.
How do I make sure my claim will be covered?
- Understand the full list of injuries and accidents that are covered.
- Disclose your medical history and work information. If you don’t disclose, you can be denied for a claim.
- Understand it may interfere with your workplace coverage. Some policies won’t pay out if you’re entitled to workers compensation.
When am I not covered?
- Injuries which have been self inflicted
- Dental injuries
- Accidents due to prior illnesses
- Injuries that have occurred while committing crime
- Dangerous behavior
- Injuries under the influence
While you can’t expect the unexpected, you can prepare for the worst by protecting yourself and your income with accident insurance. Plus, even if the worst doesn’t happen you’re still rewarded with peace of mind and tax deductible premiums.
Why might my claim be denied?
- Pre-existing medical conditions or injuries.
- The exact injury or illness is not covered. Most policies will have a defined list of injuries and illnesses that won’t be covered.
- Claims can be denied if applicants don’t disclose a pre-existing condition or injury (even if it’s covered) or an occupation they are not covered for.
- Workplace injuries. While accident insurance will cover workplace accidents, claims may be denied on some policies if you’re entitled to compensation from your workplace.
Who are possible candidates for accident insurance? A few examples are:
- Volunteers, if they are unable to perform their duties due to accidental injuries.
- Children. Accident insurance for your children can give you peace of mind knowing that they are protected and you won’t be out of pocket for all of the medical expenses.
- Tradesmen. Should you fall ill, be injured or die (some policies), you’ll have financial protection with accident insurance. In some cases, you may find it difficult to apply depending on the level of risk that you’re exposed to at your place of work.
- Athletes and extreme sports players. If you earn your living with your body, policies may be expensive due to the risk of injury involved.
What is the age limit for accident insurance?
The age limit for accident insurance will vary by insurer, however, 70 years old is a common cutoff age for eligibility. Some policies that extend coverage to the elderly may reduce the payout benefit as the insured gets older.
What factors affect how much I pay for coverage?
- Waiting period. The shorter the waiting period you select, the more you’ll typically have to pay for coverage.
- Benefit period. Longer benefit periods attract higher premiums.
- Occupation. People who work in high-risk occupations usually have higher premiums.
- Benefit amount. The higher the benefit amount you’re eligible to receive, the more you’ll pay.
- Age. The older you are, the greater your risk of accidental injury, the higher your premiums.
Is accident insurance right for me?
Personal accident insurance can seem like a duplicate policy if you already have life insurance, accidental death or you know you’re protected by workers compensation. However, think about how you would pay your bills and care for your family if you were unable to work because of an accident that happened outside of the workplace.
Keep in mind that at the end of the day deciding to purchase accident insurance is a personal decision but many decide based on whether the cost justifies the peace of mind and the knowledge that they and their family are financially protected in the event of a major accident. Some things are indeed priceless.