The policy protects the Insured against loss or damage as a result of death or bodily injury casued by accident, violence, external and visible means independent of any other cause. It is a benefit policy and is not subject to the principle of indemnity. (An insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss.)
Under this policy we have: -
1. Personal accident
2. Group personal accident
The distinction between the two is that whereas the Personal Accident Policy is issued to an individual, Group Personal Accident Policy is issued to a number of persons, normally the employees of a business. The policy is taken by the organization which is the umbrella person on behalf of its employees.
For the Insurer to be liable under this policy, the injury must be accidental and the accident must be:
- Violent: The smallest degree of violence is sufficient to satisfy the requirement of the contract.
- External: The cause must arise from outside the body, but internal injury is sufficient to give rise to a valid claim if caused by external means.
- Visible: The triggering cause of injury must be visible, if this were constrained in its popular sense it would exclude the inhalation of an invisible gas, however if a man who was running for a bus dropped dead from heart failure, the insurer will not be liable because no injury was caused by external and visible means.
SCOPE OF COVER
- Death: Death must be as a result of the above. Benefits could be fixed or based on multiples of annual salary.
- Permanent Disablement: Regarding total paralysis or injuries resulting in being permanently bedridden and any other injury causing total disablement. It should be noted that for a person to be regarded as being permanently disable, the injury must not only be permanent i.e. without chance of recovery but must also involve a total loss of ability to earn income.
- Medical Expenses: This is to cover medical, surgical and hospital expenses (including operation fees, cost of medicine, surgical appliances and hospital or nursing home charges) necessarily incurred and expended in connection with any injury by accident within the meaning of the policy. The medical expenses limit to be covered is to be selected by the insured.