Accident insurance: what the cash benefit covers
Enter the cash the policy pays for the event, its yearly premium, and the deductible and out-of-pocket maximum of your health plan. The share of your worst-case bill it covers appears at once.
Example, not your result yet· change a figure to see yours
Share of your worst-case medical bill it covers
59%
$5,000 of $8,500 out of pocket
| Share of the deductible | 100% |
| Left for other bills | $0 |
| Still yours after the payment | $3,500 |
| Years of premium the payment equals | 16.7 |
Defaults: the 2026 floor deductible ($1,700) and ceiling on out-of-pocket costs ($8,500) of an HSA plan, self-only. Enter your own plan’s figures.
Compiled by Radif Partners · How the figures are built · IRS rules and BLS plan data read November 7, 2026
Accident insurance pays fixed cash amounts for injuries and the care that follows them, according to a schedule in the policy: so much for an emergency room visit, a fracture, an ambulance ride or a hospital admission. It does not pay your medical bills; it pays you, whatever the bills are, and you can use the money for anything. Its value depends on the health plan beside it. A high-deductible plan that qualifies for a health savings account must have a deductible of at least $1,700 for self-only coverage in 2026, and can leave up to $8,500 out of pocket (Revenue Procedure 2025-19). A $2,500 accident payment covers 100% of that minimum deductible and 29% of the out-of-pocket ceiling. With a $240 yearly premium, the payment equals 10.4 years of premiums. Bought with after-tax money, accident benefits are not taxable (IRS Publication 525).
Fixed cash, not coverage
An accident policy is an indemnity contract: it pays a set amount when an event in its schedule happens after an accident, whether the bill is large, small or paid by your health plan. That is both its advantage and its limit. The money arrives quickly and can pay rent as well as a hospital bill, but the amount does not follow the cost, and an event missing from the schedule pays nothing. Policies sold at work are often voluntary, paid by the employee through payroll deduction.
The calculator measures the payment against two figures from your health plan. The deductible is what you pay before the plan pays; the out-of-pocket maximum is the most you can pay in a year for covered care. Defaults are the floors and ceilings for plans that qualify for a health savings account in 2026, $1,700 and $8,500 for self-only coverage, $3,400 and $17,000 for family coverage (Revenue Procedure 2025-19). Your own plan's figures are on its summary of benefits and coverage.
Your accident payment against your plan
Example, not your result yet· change a figure to see yours
Share of your worst-case medical bill it covers
29%
| Share of the deductible | 100% |
| Left for other bills | $0 |
| Still yours after the payment | $6,000 |
| Years of premium the payment equals | 10.4 |
Reading the result
The share of the out-of-pocket maximum is the most useful number: it is the part of your worst year the payment would cover. The share of the deductible tells you how much of a modest accident it pays. The years of premium compare the payment with what you spend on the policy. For a family on a high-deductible plan, a $4,000 payment covers 24% of a $17,000 family maximum; at $480 a year, it equals 8.3 years of premium.
None of these figures includes the probability of an accident, which the insurer knows and you do not. What they give is a sense of scale: whether the cash you would receive is meaningful against the bills you could face, and whether savings or a health savings account could do the same job.
Tax on accident benefits
IRS Publication 525 excludes benefits from an accident or health policy whose premiums you paid, or whose premiums your employer paid but included in your income. Reimbursements of medical care are generally not taxable either. When the employer pays the premium or you pay it by pre-tax deduction, fixed cash payments that do not reimburse medical costs and are not paid for a permanent loss fall under the general rule for employer-funded plans and can be income. Payments for a permanent loss or loss of use of a part of the body stay excluded in every case (section 105(c)).
Accident insurance and its neighbors
Three products are often sold together. Accident insurance pays for injuries; hospital indemnity insurance pays for admissions and days in hospital whatever the cause; critical illness insurance pays a lump sum when a condition listed in the policy is confirmed. AD&D pays larger sums for death or a lost limb or sense. Overlapping them adds premiums for the same events; the calculators on each page use the same health plan figures so they can be compared. None of them replaces income if an injury keeps you from working for months, which is the job of disability insurance.