If you go through your paperwork, there is a good chance you will find more accident cover than you know about: your premium bank card comes with travel and accident insurance, a group accident policy is tucked away in your bank account package, you took out credit protection insurance with your mortgage, and your home insurance policy has a line reading “accident add-on”. As a broker, I see that this cover can mislead in two directions: some people feel reassured by it, even though the card cover only applies abroad, and others forget to report it when a claim arises, even though the fixed sums would be paid side by side. This article takes an inventory: where this cover is hidden, what to ask about it, whether the payouts add up – and how much it is worth building on it when you size your own policy.
- Accident cover linked to a bank card, a bank account package, a loan or home insurance is real but narrowly tailored: it typically applies to a specified person, specified situations and a few benefit elements, with lower sums, and you have no say in its conditions.
- Accident insurance is fixed-sum insurance: fixed-amount benefits (accidental death, permanent impairment, fracture) are paid side by side under several contracts, whereas cost-reimbursement elements (for example, medical expenses abroad) are paid only once, up to the actual cost.
- Hidden cover is worth recording in your inventory and reporting when a claim arises, but not worth using as the basis for sizing your own policy: as a group contract, it can be amended or terminated by the bank or the insurer, and eligibility is often tied to the life of a card or a loan.
Where is accident cover hidden?
The most common hiding places:
- Bank card: mid-range and premium cards typically come with travel insurance that includes an accidental death and disability element. The key question is whether it applies only abroad, only while travelling, or perhaps only to trips paid for with the card or up to a set number of days – this differs by bank and by card type.
- Bank account package: several banks provide free or discounted group accident insurance with their account packages, where the bank is the policyholder and you are the insured person. This cover may also apply in Hungary, in everyday life, but the benefit elements and the sums come from the framework contract concluded by the bank.
- Credit protection insurance: cover taken out alongside a mortgage or a personal loan typically applies to death, disability, incapacity for work and possibly unemployment – but the payout reduces the debt or pays the instalments, and goes to the bank. After a broken wrist, you typically receive no cash from it.
- Accident add-on to home insurance: many home insurance packages include an accident element for the people living in the insured home: accidental death, permanent impairment and, less often, fracture benefit or daily hospital benefit. Its premium is almost invisible in the policy – and this shows in the sums, too.
- Accident add-on to motor insurance: driver and passenger accident insurance taken out alongside casco (comprehensive motor insurance) or compulsory motor third-party liability insurance (MTPL) covers only the occupants of the car, and only for accidents connected with the use of the vehicle.
- Travel insurance, employer group cover, club cover: the accident elements of travel insurance apply for the duration of the trip, company group cover for as long as the employment lasts, and cover linked to a registered athlete's competition licence within the framework of the sports federation.
Five questions that reveal what it is worth
For each such cover, it is worth asking the same five questions – the answers come from the policy conditions available on the bank's or the insurer's website and from the policy itself, not from the advertising copy.
1. Who does it cover? Card cover typically applies to the cardholder, sometimes also to family members travelling with them; the home insurance add-on to those permanently living in the home; credit protection to the borrower, and to a co-borrower typically only if they have also joined the insurance. Your child or your spouse is not necessarily insured.
2. When and where does it apply? This is the most common source of disappointment: card cover often applies only abroad and for a limited number of travel days, motor cover only in the car, and the home insurance add-on around the clock under some conditions and in a narrower range of situations under others. An everyday accident in Hungary – a fall on the stairs, a tumble off a bike – falls outside much of this cover.
3. What does it pay for? Hidden cover is typically limited to the two “big” elements: accidental death and permanent impairment, often with a high entry threshold, meaning that it pays only for impairment above a specified percentage. Fracture benefit, hospital and surgery benefits and the daily benefit for temporary injuries rarely feature in it; these are precisely where your own policy is strong.
4. How large is the sum? Only the conditions can tell you that – I am not giving a figure here, because it varies by product and from year to year. As a broker, I see that the sums in cover received free of charge are typically much lower than those in a consciously sized policy. How to size a policy is shown in the article on the principles of sizing.
5. Who gets the money? With credit protection insurance, the beneficiary is typically the bank – the payout settles the debt rather than going into the family budget. In group contracts, the beneficiary is determined by the framework contract, and you may only be able to nominate one through the bank. The article on who plays which role explains in detail who can do what.
And a sixth question that few people ask: how long does it last? In group contracts, you are not the policyholder. The bank and the insurer may amend or terminate the framework contract; when you replace your card, switch account packages or repay the loan, the cover also ends – and you typically learn about this from the bank's notice, not from a separate policy.
Do the payouts add up?
The good news: under Section 6:487 of the Hungarian Civil Code (Ptk.), in accident insurance the insurer undertakes to pay the sum or annuity specified in the contract in the event of the insured person's accidental death, impairment of health or disability – in other words, it is fixed-sum insurance, not indemnity insurance. The insurer does not measure how much loss you have suffered; it pays the fixed sum set out in its own table, regardless of whether you also receive something under another contract. So if your own policy, the group cover linked to your bank account and the add-on to your home insurance all pay for a fracture, each of the three pays according to its own table, and none of them has to be offset against another – with one exception: if you have several contracts with the same insurer, some conditions set an aggregate upper limit per insured person; this differs from insurer to insurer. Indemnity insurance works differently: there, under Section 6:459 of the Civil Code, the same interest may be insured with several insurers, and the insured may submit the claim to one or more of them, but the insurers share the compensation paid proportionately among themselves – so the loss is not compensated twice.
This is why cost-reimbursement elements are the exception. The medical expenses abroad, repatriation and baggage items of travel and card insurance are not fixed sums but reimbursement of costs actually incurred and proven by invoice – you cannot receive these twice, even from two contracts. Credit protection insurance, for its part, pays the bank: your own policy pays out regardless, but the two do not fill the same gap. The FAQ question on having several accident insurance policies also covers how fixed-sum cover adds up; the key point is not to skip reporting the claim to any of them just because another one has paid.
Should you count it when sizing your own cover?
As a broker, my recommendation is to treat hidden cover as an extra, not as the foundation. There are three reasons for this. The first is its uncertain lifespan: card and account cover can end by decision of the bank, credit protection expires together with the loan, and employer group cover ends when you change jobs – whereas your own policy, under its conditions, remains in force for as long as you maintain it and pay the premium. The second is its narrow scope: card cover typically does not apply to everyday accidents in Hungary, and the home insurance add-on has missing elements. The third is the sum: in the case of permanent impairment, hidden cover is typically of a supplementary order of magnitude compared with your own sum sized to replace income.
There are things worth counting, though. Credit protection insurance covers the part that you would otherwise have to build into your own policy under the heading “keep the loan repayments going” – if you have credit protection cover in force, you can set this item lower. Employer group cover is worth knowing about and fitting into the family's overall system; how the three forms build on each other is explained in the article on individual, family and group cover. For trips abroad, card cover on its own is rarely enough: the travel and accidents article shows why travel insurance plays the leading role when it comes to medical expenses.
What to do in practice
- Take an inventory: the bank card conditions, the account package information, the credit protection policy, the “supplementary insurance” line of your home insurance, the accident add-on to your casco or MTPL policy, your employer's information. For each one, the five questions: who, when, what for, how much, and who gets the money.
- When a claim arises, report it under all of them: fixed-sum elements are paid side by side; the documents (outpatient record, medical findings, discharge summary) are the same, they just have to be sent to several claims lines – for group cover, often via the bank.
- Do not size your cover on the basis of hidden cover: calculate the sum of your own policy on the principle of income replacement, and treat card and account elements as an extra.
- Check it once a year: a card replacement, a loan refinancing or a change of job can end a cover without you noticing.
If you send me your existing policies and the conditions of the hidden cover, I help where I can with the comparison: what really counts, and where the gap lies that your own policy needs to fill. The process is described in the article on reviewing an existing contract. An insurer – any insurer – pays only for what is an insured event under the contract in question; with hidden cover, this sentence is especially worth taking seriously.
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Sources
- Hungarian Civil Code (Ptk., Act V of 2013) Section 6:459 – multiple insurance; Section 6:487 – accident insurance contract
- MNB (Hungary's central bank and financial supervisor) consumer protection – Loan collateral and security
- MNB Financial Navigator – Travel insurance
