Personal accident and illness insurance – what is it?
Personal accident and illness insurance is actually the one insurance policy that most of us should have and don’t! Often referred to as “Sickness, Accident and Illness insurance”, or “Accident and Sickness cover”, this is an insurance policy that pays you either a monthly sum or a percentage of your lost salary if you are unable to work due to illness or injury.
When you take out a policy, you decide whether you would like to cover a specific amount each month or whether to link it to a proportion of your salary. You also decide whether you need long or short term cover. Most policies are available from 12 months to several years, up until your retirement age.
Do you need personal accident and illness insurance?
Well all insurance is to cover you against possibilities – you need to weigh up the odds yourself, but according to Met Life in 2012, 21% of employees have suffered long-term ill health during the course of their working life. Further to this, data from insurer LV in 2011 showed that the average length of a claim was a huge 7 years, so you may want to consider taking out a longer term policy.
What types of accident and illness insurance are there?
The two main terms you might find in different policies are “own occupation” and “any occupation”. “Any occupation” means that if you are unable to continue in your current role due to accident or illness, the insurer expects you to find any suitable work, but “own occupation” means that the insurance will pay out if you are unable to continue in your current occupation.
Does accident and illness insurance actually pay out?
Yes, in fact almost all providers of accident and illness insurance have payout rates of over 90%. This makes accident and illness insurance a much better option than, say, loan PPI which has a very low payout rate and only covers one liability.Open Claim Calculator
So what happens if I claim?
Simple. As soon as you stop working due to accident or sickness, you use your GP’s note to make a claim with your insurer. After your deferred period (a number of months of no payment, as detailed in your policy), your insurer starts to pay you a monthly benefit. This monthly payment continues until you either return to work or reach the maximum payout period (again, as detailed in your policy).
Do the maths
You need to decide on the best course of action for your circumstances. It’s worth considering what you would do if you were no longer able to work. Incapacity benefit is currently less than £100 per week, so you need to have options for living on a reduced amount if you choose not to take out accident and illness insurance.
Accident Advice Helpline
If you want to claim personal injury compensation following a non-fault accident then contact us for some expert advice. We are a law firm with the resources to help you through a bad patch and advice you on your rights if you’ve been hurt.
Call now on 0800 689 0500 or 0333 500 0993 from your mobile phone. We’re here to take your call about personal accident and illness insurance.