Common Questions about Personal Accident Insurance

When I meet many clients for the first time, they shared with me that there was a saying “a person living in Singapore shall at first purchase hospitalisation insurance and personal accident insurance”. Hospitalisation insurance is relatively easy to understand. But when talking about personal accident insurance, I found that many people had certain misunderstanding. Here are answers to some common questions about personal accident insurance.

Question 1: What are the benefits of personal accident insurance?

Personal accident insurance simply covers loss to a person due to an accident. The loss includes death, disability, hospitalisation and outpatient expenses. As long as the loss is caused by an accident, personal accident insurance will pay out the claim.

Question 2: Does personal accident insurance overlap with life insurance?

Life insurance covers death due to different reasons, including accident and illness. While the death benefit in personal accident insurance only covers death due to an accident. As a result, if a person has purchased sufficient life insurance based on his or her liability, it is not necessary for him or her to purchase the death benefit in personal accident insurance. However, if a person due to special reasons (e.g. pre-existing medical condition not covered by life insurance, or life insurance premium exceeding budget because of old age) is not able to purchase sufficient life insurance, he or she can consider using the death benefit in personal accident insurance to cover the shortfall in liability.

Question 3: I heard the saying that “a person living in Singapore shall at first purchase hospitalisation insurance and personal accident insurance”. What is the coverage of the “personal accident insurance” here?

The saying that “a person living in Singapore shall at first purchase hospitalisation insurance and personal accident insurance” is not fully accurate. The “personal accident insurance” here should be specifically rephrased as “outpatient personal accident insurance”. In this case it will not overlap with life insurance, disability insurance and hospitalisation insurance. And its importance will be more outstanding.

Question 4: My company group insurance is covering my outpatient expenses. Do I need to buy outpatient personal accident insurance for myself?

The outpatient benefit in company group insurance has different levels. Except a few high-end group outpatient packages, most group outpatient packages will set restrictions on outpatient specialist visits. For example, there may be an annual limit for outpatient specialist visits, or an employee has to get a referral letter from a general practitioner (GP) first before visiting a specialist. If you think that there are too many restrictions on your company group outpatient package, and you want to visit accident and emergency clinics, specialist clinics, licensed Chinese physician, or licensed physiotherapist directly when an accident (like a sprain, a fall, etc.) happens, you may consider getting a basic outpatient personal accident insurance as a supplement.

Above are common questions about personal accident insurance during my practice. If you have other relevant questions, welcome contacting me for a discussion.