Irdai launches standard personal accident cover, max Rs 1 cr sum assured

General and standalone health insurers will have to offer product from April 1, full claim payable on death with 12 months of accident date, even after the end of policy period

The insurance regulator has come out with  a standard personal accident cover named “Saral Suraksha Bima”, which the general and standalone health insurers have to offer from April 1, 2021. The product will have a maximum sum assured of Rs 1 crore and a minimum of Rs 2.5 lakh.

“Beyond the range specified, insurers can offer on their own and can use the same name for the product if all terms and conditions remain the same,” the insurance regulator said in its final draft.

The standard personal accident product will have a basic cover under which the entire sum assured will be paid by the insurance company on the death of the insured person due to an injury sustained in an accident during the policy period, provided that the death occurs within 12 months from the date of the accident.

Furthermore, in case of permanent total disablement due to an accident, a similar benefit will be paid by the insurer. In case of partial disablement, depending on the severity, a benefit of up to 50 per cent of the sum assured will be paid to the insured person.

The regulator has said the policyholder will get the benefit under the base cover in case of accident resulting in death, permanent total disablement or permanent partial disablement or any combination thereof, even after the end of policy period, but within 12 months from the date of the accident.

There will also be an optional cover, under which, if the insured person sustains an injury in an accident that renders him/her incapable from engaging in any employment or occupation which the insured person was capable of performing at the time of the accident, then he/she shall be eligible for a compensation at the rate of 0.2 per cent of the base sum insured per week, till the time they are able to return to work.

Moreover, hospitalisaiton expenses arising due to an accident shall be indemnified up to the limit of 10 per cent of base sum insured. Also, a one-time educational grant of 10 per cent of the base sum insured shall be payable to all dependent children of the insured following an admissible claim made of the insured person towards death or total permanent disability, provided that the children are pursuing an educational course and they are not above the age of 25.

The regulator has said the sum insured under the policy shall increase by 5 per cent each year for each claim free policy year, provided the policy is renewed without a break. This increase in coverage has been capped at 50 per cent of the basic sum insured. If a claim is made in any particular year, the cumulative bonus accrued may be reduced at the same rate at which it has accrued, the regulator said.