Find out everything about disability and what it means in the context of accident insurance


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Definition: What is disability?

In the context of accident insurance, disability means that someone has suffered permanent damage to their health as a result of an accident, which permanently impairs their physical or mental capacity. To be classed as a disability, the physical impairment must be expected to last for more than three years. To give you an example: Imagine that you cannot grip properly with your right hand after an accident. As a result, everyday activities such as washing dishes, riding a bicycle or writing, which are easy for a healthy person to do, become a great challenge for you. If you have an impairment of this extent and it is unlikely that your condition will improve, this is called a certain ‘degree of disability’.

A person who breaks a leg is certainly also incapacitated and restricted for a while. However, this is not classed as a disability if the fracture heals completely within a year, for example. This would not be covered by accident insurance.

What is the degree of disability? How is it measured?

The degree of disability reflects the extent to which the injured person is impaired in their everyday life after an accident. Such impairments can occur in varying degrees. Even problems that limit the mobility of limbs can affect us in everyday life. However, the impairment that someone experiences when losing a body part is far more severe. Such differences are expressed by the degree of disability.

For health restrictions affecting certain parts of the body or sensory organs, the degree of disability is calculated using a schedule of compensation. A precise value for the degree of disability must be determined in order for the accident insurance company to pay the disability benefit. This is done by calculating the extent of the impairment using the schedule of compensation. To illustrate this, here’s an example. The schedule of compensation for the whole arm is 70%. After an accident, your arm is only half as mobile as before, i.e. 50% impaired. In this case, the degree of disability is also half of that stated in the schedule of compensation, i.e. 35%.

In which cases does the accident insurance pay?

You fell, had a car accident or you tried to lift a box that was too heavy for you and are now lying in hospital with a nasty torn muscle? If you suffer permanent impairment after accidents like these, you can count on financial support from your accident insurance. What is considered an accident in the context of accident insurance is explained here. It’s important to know that even if the disability occurs some time after the accident, you could still be entitled to insurance benefits. If you experience long-term consequences within 15 months after the accident, your accident insurance will still pay the disability benefit. However, you must already be insured at the time of the accident.

Example: Calculating the insurance payment after a bicycle accident

While you are out on your bike, a branch suddenly appears on the path in front of you. You fall badly and injure your upper arm. Luckily, a passer-by takes you to the nearest hospital as quickly as possible, where it turns out that you have a compound fracture in your upper arm. Even half a year later, you can no longer lift your arm properly and the prognosis is: no improvement in sight. Your doctor certifies that your arm's performance has been reduced by 50% and you report the accident and the suspected disability with all certificates directly to your accident insurer.

Let’s use a small example to explain how the benefit is calculated: You have agreed on a base sum of 100,000 euros, the schedule of compensation for the arm is 70% and the functional impairment of the arm is 50%. The first step is to calculate the degree of disability as follows: schedule of compensation (70%) × functional impairment (50%) = 35%.

You also benefit from the fact that when you bought accident insurance, you agreed to a 225% progression, which, according to your contract, equals 45% from a 35% degree of disability. Finally the payment is calculated as follows: Base sum (€100,000) × benefit including progression for 35% disability (45%) = €45,000.

Author: Carina