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Accident Insurance vs. Health Insurance: What’s the Difference?

In every organization – from companies to athletic teams, and even families – each individual may serve a specific role to complement the contributions of the rest of the team. All organizations – including families – also need their insurance coverage to protect against a range of possible losses, and different kinds of insurance can play their part, even relating to the same incident.

Accident insurance and health insurance have some similarities in that they can both pay for medical expenses when a covered person suffers an injury. So why would you need both kinds of insurance? To answer that question, we need to look at how each of these types of coverage works.

First, you should know that accidental injuries are one of the most common reasons individuals require medical treatment. Accidents happen at any age, but are even more common for children and younger adults. According to the National Safety Council, 1 out of 8 Americans each year seeks medical care due to injuries. About 88% of accidents are non-traffic related. Falls are the leading cause of accidental injuries among Americans in almost every age group. A study by the global nonprofit organization, Safe Kids Worldwide, found that 90% of young athletes report being injured while playing a sport.

Health insurance provides financial protection from medical expenses due to illness and injury (except for those that happen on-the-job, which are covered by workers’ compensation). Health insurance reimburses a percentage of eligible medical expenses, once the plan deductible amount is satisfied. This coverage only pays for medical expenses; it does not pay for related needs when a person gets injured.

Accident insurance pays a specified cash benefit if a covered person has an accidental injury, but only for accidents. It does not cover illnesses. There may be a deductible, but it is usually much lower than the health insurance deductible. The benefits under accident insurance are paid to the insured person, and do not have to be used exclusively for medical expenses. So, if somebody needs extra household help, like child care, transportation to doctor appointments, house or yard work, accident insurance benefits can pay for those expenses. The cash payment can also help fill in the medical insurance deductible and copayments as well.

Accent insurance can work side-by-side with health insurance to give a family or individual more comprehensive financial protection in the event of an accidental injury. And, many accident insurance policies provide benefits for occupational injuries as well. You can see how accident insurance plays its distinct role in helping an injured person take care of the extra costs of an accident beyond the medical treatment.

It’s important to consider all the ways you could be affected if you have an accident, and the additional costs you might incur beyond the urgent care, hospital or physician’s office. Accident insurance could be additional, affordable layer of financial security that can make recovering a lot less stressful.

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