Should You Buy an Accidental Cover with Term Insurance Plan?

By Ruchi Gohri
  | Published: 26 October 2021 | Last Updated On: 11 November 2021

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Term insurance plans are the most uncomplicated and affordable life insurance that offers comprehensive protection during an unforeseen event. Apart from affordability, the plan comes with numerous riders that the policyholder can add to the existing term plan with a nominal premium raise. Despite the increase in the premium, add-on riders prove useful for extensive coverage. 

A term insurance plan in the UAE offers death benefits if the policyholder dies during the insurance tenure irrespective of the cause of death. However, for sole earners, death is not the only prime threat. An accident may disable them permanently or temporarily and create a financial burden on their family. In such cases, the basic term plan is inadequate and may not provide any benefits. 

Therefore, several providers in the UAE offer accidental cover with a term insurance plan that protects the policyholders from accidental consequences, including permanent and temporary disabilities. The article below details whether you should buy an accidental cover with term insurance or not. 

What is the Coverage Extent of Basic Term Insurance in the UAE?

A basic term insurance plan protects the policyholder from an unfortunate death during the insurance tenure. The insurance benefits may limit security against unforeseen demise only. Following are the coverages offered by a normal term insurance plan in the UAE without any additional rider.

  • Natural Death - A term insurance plan covers the policyholder’s natural death during the policy tenure, and the insurance provider pays the death benefits to the policyholder’s beneficiaries.
  • Accidental Death -  In case of accidental deaths such as road accidents, the policyholder’s beneficiaries receive the death benefits. 
  • Death Due to Natural Calamities - If the policyholder dies due to a natural calamity like earthquake, cyclone, flood, the insurance company pays the death benefits to the beneficiaries. 
  • Death due to Illnesses - The term insurance covers the policyholder against death caused due to illnesses. If an individual dies because of an illness during the policy tenure, the insurance company pays the death benefits. 

The term insurance plans may offer a few other benefits depending on the company. Although the term insurance plan provides extensive security against various life threats, the policyholder’s beneficiaries receive only the death benefits. Other casualties such as total or partial disability are not covered under the normal term insurance. That’s why you need an additional rider such as an accidental cover. 

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Why Do You Need an Accidental Cover With the Term Insurance Plan?

Despite offering extensive protection, the term insurance does not cover the disability due to accidents and related medical expenses. If you don’t have an accidental cover with the term insurance plan, you would have to deal with the financial hardship on your own. With a basic term insurance plan, you can only avail of insurance benefits if the policyholder dies due to an accident. 

However, if you own a term insurance plan with accidental cover, the company would offer you accidental benefits for treatment and other medical expenses. Additionally, if you die during the treatment due to accidental injuries, the insurer pays the death benefits to your family according to their company policy. 

The accidental benefits may vary depending on the insurance provider, and you need to go through the policy details before buying term insurance in the UAE.

Should You Buy an Accidental Cover Add-On With Your Term Insurance Plan?

An accidental cover adds to your security requirements and protects you against injuries and death due to accidents. However, this also increases the cost of your term insurance plan. The accident cover requirement varies from person to person since the accident risk varies accordingly. An individual working in an industry has a higher chance of meeting an accident than one working in the office. If you are confused about whether you require an accidental cover or not, you can consider the following conditions to aid you to decide your policy - 

  • If an individual is in a profession that exposes him to accidents, term insurance with accidental cover would be beneficial. 
  • An individual involved in adventure sports needs an accidental cover with term life insurance because he has a higher risk of injuries due to accidents. Such individuals should also ensure that their insurance provider covers them for casualties due to accidents since various insurance providers exclude injuries and death due to accidents. 
  • Individuals working in petroleum industries, mines and construction sites require accidental cover since they are prone to accidents. 
  • Professionals such as truckers and drivers who constantly stay on the road need an accident cover with their term insurance plan. 
You may also like this - How Term Insurance Is Different from Accidental Insurance?

Companies with risky job profiles offer group life insurance, but the coverage amount is not adequate. Apart from the above, individuals looking for comprehensive accidental protection should opt for the additional rider. The add-on cover protects the individual against accidental disabilities, including permanent and temporary disabilities. In addition, the term insurance with accidental cover covers the medical expenses incurred during the treatment.   

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What are the Benefits of Term Insurance Accidental Cover?

Similar to other add-ons, the accidental cover increases the extent of protection provided by the term insurance plan. With a nominal price increase, the policyholder gets comprehensive protection against accidental consequences. Following are the benefits of term insurance with accidental cover:

  • Insurance Benefits - With an accidental cover, the beneficiaries receive insurance benefits in case of death due to accidents and disability caused due to accidents. For individuals with accidental cover term insurance, various companies offer higher death benefits if they die due to accidents.  
  • Medical Expense Coverage - If the policyholder gets injured during an accident and hospitalised, the insurance company covers the medical, surgical and treatment costs. Additionally, if the policyholder dies during the treatment, the insurance company pays the death benefits to the beneficiaries. 
  • Disability Benefits - Accidents can result in permanent bodily damages and leave the individual disabled for life. The insurance plan with accidental cover secures the policyholder against total and partial disability. In the case of a permanent total disability, the insurance plan offers disability benefits to replace the policyholder’s income. The benefits are paid out at regular intervals for a tenure of up to 10 years. 
  • Security and Confidence - With an accidental cover in your term insurance, you feel secure and confident. This, in turn, reduces the chance of committing mistakes and helps you to stay vigilant. Additionally, you can enjoy your profession better and have peace of mind.  

Conclusion

The accidental cover is an optional add-on in the term insurance plan that you can opt to secure yourself against accidents. The coverage offers financial assistance during hospitalisation and covers medical expenses during the treatment. With an accidental cover term insurance, you also receive disability benefits that replace your income lost due to the inability to continue working. 

An accidental cover is not compulsory for all individuals. However, if you are in a hazardous profession or lifestyle, you should opt for it. An accidental cover increases the insurance cost, but the protection justifies the cost and secures you comprehensively.

Ruchi Gohri
Ruchi Gohri

Senior Content Writer | She has a penchant for writing and with over 5 years of experience, she plays around with words elegantly, crafting simple content for all to read. In her free time, she loves her couch either to read or catch on to her sleep.