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STUDENT ACCIDENT 101

WHAT IS STUDENT ACCIDENT INSURANCE?

Student Accident is a form of insurance that schools implement as a way to shift liability away from the organization. In essence, Student Accident Insurance is:

  • Risk Management for Schools
  • A cost-effective tool to reduce financial worry for parents
  • Immediate access for all students to quality medical care due to an accident

Student Accident Insurance is also one of the most under-utilized and structurally misunderstood zero-cost liability reduction solutions for schools.

WHY DO WE NEED STUDENT ACCIDENT COVERAGE?

  • The number 1 killer of children is unintentional injury.
  • Many medical policies do not provide comprehensive coverage.
  • School related injuries resulted in $3.2 billion in annual medical expenses.
  • 2.2 million children aged 14 and under sustain school related injuries each year.
  • An accident needing medical attention happens on the playground every 2 and a half minutes.
  • Annually, 1 in 14 students suffers a medical attended or temporarily disabling injury at school.
  • 775,000 sports or recreation related injuries occur in and around schools each year to children under age 15.
  • An estimated 40 million individuals in the US do not have medical insurance.

STUDENT ACCIDENT COVERAGE – UNDERSTANDING THE BASICS

Student Accident coverage falls under the insurance category of Special Risk Coverage. Since it is not a mainstream type of coverage (i.e. Major Medical, Disability, Life, etc.), there are comparatively only a handful of quality providers in the United States. Currently there is no clear dominating provider of coverage in the US. Even more distressing is that the major plans vary widely on loopholes and variances in coverage.

LEARN ABOUT THE DIFFERENT PARTS OF COVERAGE

Click on the following terms to learn more about what they are, and how they apply to your coverage.

Voluntary Coverage

Voluntary coverage where parents choose whether or not to participate was originally developed for public school systems. Since public school systems are not subject to the same risk exposure to lawsuits, student accident coverage serves a different purpose: Limited coverage for students without health coverage rather than risk reduction for the school system.

Mandatory Coverage

For private schools, mandatory coverage is the only sensible option. Mandatory coverage reduces the risk of litigation as well as providing immediate and equal access to quality medical care for all students. Another benefit is a reduction of stress for the staff as there is no longer the need to check the student’s file for insurance benefits (or lack thereof) before deciding on treatment for an accident.

Deductibles

Deductibles allow insurance companies to lower rates by eliminating claims exposure. With student accident coverage, the savings are minimal. However, the negative affect associated with deductibles is quite high. For example, with minor accidents the only out-of-pocket expense for the parents may be the co-pay for an office visit and prescription. The co-pay, usually $10 – $45 per claim, is almost always less than the deductible; thus the parents receive no benefit from a policy with deductibles. Deductibles frustrate parents and often cause the school to lose the good will created with parents when a plan does not pay for the injuries the child has incurred.

GL Policies

These are designed to pay (on behalf of your school) all monies it becomes legally obligated to pay. Primarily, it is a 3rd party policy covering negligence when the school, or school personnel, are the proximate cause of bodily injury or property damage to a 3rd party. In order for a 3rd party to be the indemnified under your GL policy he/ she is generally required to file a lawsuit against your institution. There is a potential exception to this general rule, medical payments (see Accidents under a GL policy). When negligence is proven in court, the sums the policy pays on the school’s behalf can be both compensatory (i.e. medical costs, pain & suffering, and punitive punishment).

Under most GL policies, there is also a “Medical Payments Coverage” feature designed to protect your school from accidents occurring because of possible negligent operation or accidents on school grounds. This section of the policy pays up to a small limit (typically $5,000) and it is paid regardless of fault. It generally has an exclusion for any person taking part in athletics. A GL policy is one method for compensating parents for student injures at school. It is not designed for athletic injuries nor is it designed to handle routine injures efficiently or expeditiously. Once a GL claim is made, that claim is recovered and factored into the rating process to determine your premium for many years to come.