Not everybody thinks that personal accident coverage is necessary or crucial. Some may even believe that personal accident insurance coverage is more suitable for individuals employed in high-risk occupations or by those partaking in risky day-to-day activities.
This isn't true as an accident can strike anyone. Even if you think that you have sufficient health or life coverage, there are several key benefits to being covered by a personal accident plan that you should consider.
1. Accidents are not an "if" but a "when"
Accidents can arise when you least expect it. It can happen because you are plain careless or by just being in the wrong place at the wrong time. Accidents are not just unpredictable and unexpected, but can expensive too.
Your health insurance only provides coverage when you are hospitalised and for medical treatments. If you are unable to work after an accident, your emergency savings can be quickly wiped out. Hence, you should be prepared for such scenarios.
2. Covers outpatient treatments
An important benefit of a personal accident plan is the ability to claim medical reimbursement for certain inpatient and outpatient treatments, such as an MRI scan or a CT scan, which can be costly, after an accident. Unlike hospitalisation plans, personal accident plans do not require you to be hospitalised to be able to claim for certain treatments.
You can view your personal accident plan as one that complements your health and life insurance coverage.
3. Income benefits
Accidents have the potential to impair a person's ability to work, either on a long-term or short-term basis, or depress your future earning power.
In such scenarios, a personal accident plan will be able to protect you from accident-related medical bills as well as provide compensation to make up for lost wages. This is through paying a daily hospitalisation benefit and/or a lump sum payout.
4. Extensive coverage
While nobody ever wishes to be struck with an accident that disables them. However, it is always better to be safe than to be sorry. Mild or serious disabilities that hinder your ability to generate an income will not be covered under your life insurance or health insurance.
For life insurance, coverage is only applicable if you lose your life or suffer total and permanent disabilities. Health insurance only takes care of you when you are hospitalised, and do not provide lump sum payouts for you and your loved ones to tide through challenging financial situations.
A personal accident plan, on the other hand, provides this peace of mind, enabling you to focus on getting better and bouncing back as quickly as possible. While Singaporeans also enjoy a national severe disability coverage under ElderShield (and CareShield Life in the future), the criteria for receiving a payout tend to be more stringent – losing three out of six ADLs (activities of daily living).