Understanding accident sickness and unemployment insurance

Many people take out a wide range of insurances including life cover and an array of medial and healthcare insurances. However, with the economy in its current state, now may be the time to consider additional levels of insurance, such as accident sickness and unemployment insurance.

Why Take Out Accident Sickness and Unemployment Insurance?

Accident sickness and unemployment insurance are designed to protect one from a fall in income, should one be subject to one of the three conditions which would prevent an individual from attending one’s normal occupation.

Whilst in many countries, such as the UK the state will provide a comprehensive package of benefits if such unfortunate events arise. There is still the consideration that such benefits will not allow an individual to live the lifestyle, which they would have been able to through working.

As such, specialist accident sickness and unemployment insurance products give individual peace of mind that should they become unable to work, they will at least for a time be able to maintain a comfortable lifestyle.

Problems With Accident Sickness and Unemployment Insurance

One concern with such policies is simply the cost factor. The relatively high level of risk for the insurer, linked to the often generous payouts to claimants means that monthly insurance premiums can be high. As such, over time one consideration is that one may be better off having invested the premiums in an alternative savings related financial product.

Another concern is the level of cover which is achieved by taking out accident sickness and unemployment issuance. Whilst terms and conditions are specific to the provider and product chose, few policies will offer a comprehensive level of benefits for an extended period of time. As such, when taking out a policy it is essential to find out exactly how much cover is provided and perhaps more importantly, for how long.

A further consideration before taking out such private insurances is that one should check the availability of similar employer-sponsored options. Many companies offer their employees a comprehensive range of sponsored or discounted packages, especially in relation to accident and sickness insurance policies.

In summary, accident sickness and unemployment insurance can provide a source of real comfort in the current unstable economic environment. However, relatively high premiums mean that such products may not be the best choice for all, especially where the risk of unemployment is lower.

Pros & Cons of an Accident Life Insurance Policy

Accident life insurance pays out a guaranteed cash lump sum if you die or suffer a dismemberment as a direct result of an accident. It’s relatively inexpensive to take out accidental death life insurance and it provides a useful supplement to a level term or whole life insurance policy. It’s useful for men and women who spend much of their working life traveling or who work in a dangerous occupation.

It should never be thought of as an alternative because accident insurance cover doesn’t help your family in other situations. For example, if you die from cancer, liver failure or a heart attack your policy won’t payout. That is why an accident insurance policy is often added as a rider. You’re less likely to die as a result of an accident, but that doesn’t mean that it won’t happen to you.

Advantages of Accident Life Insurance

Lump-sum payment. If you die in an accident, a substantial sum of money will be paid to your estate. You’ll also receive a “scheduled” payment if you lose a limb or your eyesight.
Low premium. This additional cover can be taken out for about the third of the cost of level term cover. For example, you’re able to get £120,000 of accident insurance cover for less than £10.
Rider vs standalone policy. Although it may be worthwhile to take out additional coverage as a standalone policy, many level term policies add twice the cover for accidents.
No medical checks. Provided that you fall within a specific age range, you’re guaranteed to be accepted without undergoing a medical examination.
Peace-of-mind. Families tend to feel more secure when they have the proper coverage in place.

Is Accidental Life Cover Worthwhile?

Accident life insurance provides an inexpensive and useful addition to a level term or whole of the life insurance policy. Never consider it to be an alternative because you’ll only be covered against accidents. You can take out a stand-alone policy, but many insurers already include coverage as a rider.

If you don’t already have it, critical illness insurance may prove to be more valuable than an accidental death life insurance policy. Aside from the fact the most life insurance policies include it as a rider, you’re far more likely to develop a life-threatening illness than be killed in an accident.