DIFFERENCE BETWEEN PERSONAL ACCIDENT AND LIFE INSURANCE

When it comes to understanding the difference between a personal accident and life insurance, you need to understand the fundamental traits of both before getting any deeper. Simply put, under life insurance, the insurer provides financial protection to the family of the insured upon death. It is a death benefit. Life insurance is also known as Term insurance caters to anyone dependent on the insured in the unfortunate event of death of the insured.

On the other hand, as the name suggests personal accident insurance caters to only protection in case of death resulting specifically from an accident only. It also covers any bodily impairment and disability from the accident as well.

Major differences between personal accident and life insurance

Both personal accident and life insurance policies make the family of the insured financially secure in case of the death of the insured. Though these policies cover death benefits, the primary difference between them is personal accident insurance covers death due to an accident while life insurance covers death in general due to any cause.

Conclusion

Though a personal accident policy offers coverage from death or disability in case of an accident, it is always advisable to purchase basic life insurance and then purchase personal accident cover as an Add-on. This way you can benefit from getting wider coverage, and broader protection and also avail additional advantages like discounts or tax benefits that the combination of these policies offers. Keep in mind to compare plans before choosing the one that best fits your requirement.

FAQs – Frequently asked questions.

Let's take a look at some frequent queries on the difference between a personal accident and life insurance;

Q1. Does death from overdose or driving under influence of any drugs get covered in life or personal accident insurance?

Ans. No, death from overdose or driving under influence of any drugs gets covered in neither life nor personal accident insurance.

Q2. Does life insurance cover for death from illness as well as death from the accident?

Ans. Yes, a life insurance plan covers death from any cause but not for injury or disability in an accident.

Q3. Does personal accident insurance cover financial benefits in case of loss of limb, sight, or hearing?

Ans.Yes, personal accident covers for financial benefit in case of loss of limb, sight, or hearing but only in case of an accident. These are not covered under life insurance as it secures only against death due to any cause, including accident.

Q4. Are there any exclusions to both life and personal accident insurance?

Ans. Yes, both life and personal accident insurance do not cover death due to high-risk adventure activities such as motor racing, sky diving, driving in drug overdose, drunk driving or driving under influence of drugs, suicide, war situation, and complications from surgery or mental illness.