Disability Insurance in India: How to Get it!

Insuring one’s ability to keep earning livelihood is of paramount importance. Accidental disability can render anyone temporarily or permanently disabled for life. This is why we all look for an insurance policy for disability. However, getting disability insurance in India is not a straightforward task. In fact there are no separate insurance policies available especially to cater for the events of disability. So, many people wonder how to get such an insurance policy. Today I am going to write a few facts on this subject.

What is Disability Insurance?

Disability insurance is also known as disability income insurance. It is an insurance policy that covers a person for disability conditions in future. Disability due to accidents and diseases can strike anyone at any time. Such an event may adversely impact one’s ability to earn. A disability insurance policy ensures that if such an event happens, the insured person would get financial assistance. The money got from disability insurance can come handy for treatment and to provide for the dependent family members.

A lot of people do not understand the importance of getting a good disability insurance. People make all sorts of investments but they hardly invest a portion of their income in securing their future against permanent or temporary disabilities.

Depending on the nature of disability, the insurance can provide short-term disability benefits or long-term disability benefits.

How to Get Disability Insurance in India?

As I said earlier, there are no separate insurance policies available for protection against disability. But various Life Insurance and Term Insurance plans come with disability and accident riders. A rider is an add-on for which you will have to pay extra premium. If you opt for disability rider in your insurance plan — then you will receive benefits in case of a disability. Some plans offer benefits only in case of permanent disability whereas some other offer benefits for temporary disability as well.

Disability Insurance often Corresponds to Monthly Income

In many western countries benefit you get from a disability insurance depends on your earning capacity. Essentially these insurance plans aim to provide you a steady and some percentage of your monthly income in case you can no longer work due to a disability. This monthly support goes on for life.

However, in India such products are not available. If you take disability rider in your insurance plan, you will just receive a lump sum amount in the event of disability — and that’s all! You will not receive any monthly income from the insurer.

Moreover, in case of disability riders, only those disabilities are covered that arise due to accidents. Disabilities caused due to illness (e.g. paralysis stroke) are not covered under such riders.

Accident rider in your policy will pay you a specific amount in case you met an accident. The aim of this rider is to provide monetary support for the treatment of injuries caused due to accident.

Disability rider will pay you a specific one-time amount in case the accident results in a partial or permanent disability that would stop you from carrying out your livelihood earning.

Cheapest Disability Insurance Policy in India

As there are no separate insurance products for disability from the private insurance sector, the Government of India has brought out the Pradhan Mantri Suraksha Bima Yojana (PMSBY). This scheme provides an accidental death and permanent disability cover of Rs. 2,00,000 and Rs. 1,00,000 cover for permanent partial disability.

In PMSBY, the permanent disability is defined as the irrecoverable loss of

• both eyes
• both hands
• both feet
• one eyesight and loss of use of a hand or a foot

The permanent partial disability is defined as the irrecoverable loss of

• one eye
• one hand
• one foot

For this disability insurance, you will need to pay annual premium of only Rs. 12. Such low premium makes PMSBY the cheapest disability insurance in India.

Another beauty of this scheme is that you can use it along with any other insurance policy. You will certainly get the insured amount in case of an unfortunate event.

Niramaya Health Insurance Scheme

Niramaya Scheme is being offered by The National Trust in collaboration with ICICI Lombard, a private insurance company. The National Trust is a statutory body constituted by enactment of an Act of Parliament by the Government of India, for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities.

This was all about the state of disability insurance in India and how to get the best of it. As always, we request you to share you knowledge and experience in this regard so that other people can get benefit from it. Please feel free to use the comment box in order to give your inputs. Thank you for using WeCapable. Stay connected with us!