Personal accident insurance and health insurance policies are two products that cover your medical expenses but differ across the terms and conditions of coverage.
As the name suggests, a personal accident policy provides coverage during an accident and the healthcare implications that can arise from it.
On the other hand, a healthcare insurance policy covers particular illnesses and diseases; it might not provide benefits during an accident.
The difference between a personal accident scheme and health insurance policy is discussed below:
Personal Accident Policy
Provides Hospital Allowance
These insurance policies offer a fixed allowance per day up to a limited period during hospitalisation. For instance, personal accident insurance offered offers Rs. 1000 hospital allowance every day up to 30 days.
Compensation for Total Disability
Personal accident insurance plans may offer up to 125% compensation when the accident causes a permanent disability.
If no claim is made on the insurance policy, the policyholder can avail a cumulative bonus every year. The bonus rate ranges from 10% to 50%.
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Reimbursement of Medical Expenses
Insurance companies can reimburse up to 40% of your medical bills or claim amount (whichever is less).
Bonus for Children Education
Companies provide Rs. 5000 per child or 10% of the capital sum to children below the age of 19 to take care of their education expenses in case of death or permanent disability with a personal accident insurance policy.
Discounts When Covering Families
Some insurance companies provide a 10% discount when two or more families are included in a personal accident policy.
Personal accident policies will cover dependants provided they are between the ages of 5 and 21 years.
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Covers Pre and Post-Hospitalisation Expenses
Not only during hospitalisation but health insurance plans cover all medical costs before and after admission.
No Need for Medical Tests
Few insurance providers don’t require customers to go through a medical examination if they are under 45 years of age.
Tax Saving Benefits
Premium paid on health insurance policies helps you claim income tax benefits. You can avail an exemption up to Rs. 60,000 under Section 80D of the Income Tax Act.
Some health insurance schemes come with cashless facility enabling you to avail healthcare without spending any money.
You have to avail healthcare from the network hospitals of your insurance provider to take advantage of this facility. This feature eliminates the lengthy process of making claims to receive reimbursement.
The top-up health insurance is a product that offers the cashless facility. The same can be availed from over 5,700 network hospitals of the company. This insurance policy covers up to 6 family members including parents and children. You also receive coverage for pre and post-hospitalisation expenses.
Health insurance plans also provide a cumulative bonus for every claim-free year. However, you can only avail a bonus of 10%.
Coverage of Other Medications
Some health insurance policies also cover Homoeopathy and Ayurveda treatments and medications.
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Availability of Discounts
You can avail the following discounts:
- 8% discount when opting for a 3-year and 4% discount availing a 2-year scheme.
- 15% discount when covering 3 family members and a 10% discount for including two family members.
Health insurance schemes also include children under the coverage provided they are between the ages of 3 months and 30 years.
Do make sure to read the terms and conditions before opting for a personal accident insurance or health insurance scheme. Some instances may not be covered under a personal accident insurance policy. For example, adventure sports and self-inflicted injuries are not covered.
Likewise, you will not avail benefits in case of some diseases under health insurance. Some health insurance policies cover pre-existing diseases only after the completion of a specific policy period.