What Are Accident and Health Benefits?

Accident and Health Benefits are a type of health insurance policy that is purchased by companies on behalf of their employees. They are intended to supplement the standard health insurance policy offered to employees, by providing protection for accidents that might occur within the workplace.

Key Takeaways

  • Accident and health benefits are a type of supplemental health insurance policy.
  • They provide coverage for non-traditional expenses such as transportation costs and lost income due to time spent recovering from an injury.
  • Companies sometimes purchase accident and health benefits for their employees, in order to make their workplaces more attractive to candidates.

How Accident and Health Benefits Work

One of the ways that companies seek to attract and retain employees is by offering health insurance and other benefits. In the United States, most citizens obtain their health insurance privately, with many relying on the insurance plans offered by their employers. Aside from salary and general working conditions, health insurance plans are often one of the key factors that candidates consider when deciding whether to accept or decline a job offer.

Generally speaking, however, the health plans offered by employers will have gaps in their coverage, meaning employees may still be exposed to significant risks. For example, if an employee is injured while working on the job, their standard employee health insurance might not provide them with any support for lost income if they are unable to work due to their injury. 

To supplement this, an employer might also purchase an accident and health benefits plan on behalf of their employees. These plans can be designed to specifically address the gaps in the company’s standard health insurance coverage, in areas such as child care, transportation to and from medical appointments, or help with medical deductibles. Depending on the budget of the employer, these accident and health benefits could even provide injured employees with additional income for the time in which they are unable to work. Although these plans are an added expense for the employer, they may represent a worthwhile investment if it allows them to attract and retain more talented employees.

Real World Example of Accident and Health Benefits

Michael is warehouse worker who recently received two job offers. The first offer contained an above-average salary and a standard health insurance plan, whereas the second offer contained an average salary and an above-average health insurance plan which includes supplemental accident and health benefits.

In considering the pros and cons of these two offers, Michael takes note of the fact that, because his job involves handling heavy objects and using machinery, he may become injured at his workplace at some point during the next few years. Although the standard health insurance plan would cover standard medical expenses associated with doctor’s visits and medications, it would not cover additional costs such as transportation expenses or lost income while he is recovering from his injury. With that in mind, Michael decides to accept the second job offer. In the end, the added peace of mind of the superior medical coverage was more important to him than the difference in salary.