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Accidental life insurance policy is a contract that covers person’s death or various injuries suffered in accidents. This kind of insurance is a good alternative to other life insurance policies. First of all, it is quite an inexpensive way to obtain coverage. This happens because only about five percent of deaths in UK are suffered in various accidents. Thus, the risk of having to make a pay out to the client because of accidents is lower compared to other life insurance policies that cover all death occurrences. This and the fact that insurance market in UK is very competitive leads to that usually accidental life insurance can be provided at a very good terms for the one who wants to get insured.
Contents
Advantages
The main advantage is that it is easy to get accidental life insurance and it is quite affordable. For example, “Barclays” offers maximum coverage of £ 250,000 for only a little more than £ 7 per month. Moreover, this kind of insurance covers not only death but also various injuries that are suffered in the accidents. Thus, it is possible get coverage if more serious permanent injuries, such as loss of limbs or sight are suffered in accidents. Furthermore, some insurance companies offer to cover the costs of hospital fees or necessary surgeries if the need for them is caused by the accidents.
One more important factor is that in order to get accidental life insurance there are no medical questions as they are not of big importance for this kind of insurance. Thus, for some people it is one of the chances to get a life insurance with good conditions even if they were not able to a get a basic life insurance in the past because of poor medical record.
Options that can be offered
Moreover, this kind of insurance policy is very comfortable for employees who need to travel a lot. It is estimated that the probability to suffer and accident increases greatly for active travellers. Especially, for those that mostly travel by car or other means of land transport. Thus, the insurance carrier may offer many additional options with accidental life insurance. This includes such proposals as full occupational coverage, business and pleasure coverage and war-risk coverage.
There are a lot more options that may differ depending from the insurance company. However, usually insurance companies are very willing to underwrite such policy as the person will pay additional money for it and the risk of the client having such an accident as car or airplane crash usually is very small.
Disadvantages
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However, this kind of insurance policy has many disadvantages. First of all, it offers very narrow coverage. If with normal term life or whole life insurance the dependents would be paid benefits in case of death in most occurrences, then with accidental life insurance the coverage is limited only with death or permanent injuries suffered in accidents.
Moreover, usually the beneficiary must prove that certain injury or death was caused by the accident. In many cases person dies not in the accident or not immediately after it. Thus, it weakens the chances of getting a pay out as it becomes harder to prove direct connection to a particular accident.
Furthermore, even though the death or permanent injury occurred because of the accidents but certain amount of days have passed (most this time period is set from one to three months) then, though insurance company will cover hospital fees and costs of necessary surgeries, it is likely that they will not cover the death as enough days have passed for insurance company to attribute the death not directly to the accidents. Beneficiaries may defend themselves in the court but with this kind of insurance policy it must be remembered that all of the responsibility of proving the link between death and certain accident falls to dependents alone.
One more factor is that many insurance providers narrow the cases in which the benefit lump sum will be paid only if the accident is a common case. Though, there may be insurance companies that will cover such extreme cases as something heavy falling on individual head and causing him to die, usually it is not the case and most insurance companies will not want to pay-out the benefit to the dependents.
Accidental life insurance with combination of life insurance
As accidental life insurance is quite cheap but covers limited number of deaths it is advisable to use it along with normal term or whole of life insurance. In such case, the person is guaranteed that term or whole of life insurance will pay out the lump sum to his dependents in case of his death. However, if the death has occurred because of the accident both policies will pay the benefit and the dependents will get more financially sound as the higher sum of money will be paid out to them.