Why health insurance is important for the youth
Young people often refuse to buy health insurance thinking that there is nil or very low probability of falling ill and hence there is no point in wasting money in paying premiums.A fast-moving life consisting of an imbalanced diet and irregular sleep cycle have resulted in lifestyle diseases amongst youngsters.
Young people often refuse to buy health insurance thinking that there is nil or very low probability of falling ill and hence there is no point in wasting money in paying premiums. However, participation of young people in insurance pools is very important for the Health Insurance Industry, as with lower probability of falling ill, their participation would lower the average claim ratio and burden on the insurance pool, resulting in reduction in premium level.
Moreover, health insurance not only provides tax benefits and helps in financial planning, but it may also be treated as charity as the premium paid would be used partly to settle the hospital bill of another insured person, thus helping him/her indirectly at the time of need.
“Health insurance has become a vital part of financial planning, especially for the younger generation as more than 50 per cent of India’s current population is below the age of 25 and over 65 per cent below the age of 35. A fast-moving life consisting of an imbalanced diet and irregular sleep cycle have resulted in lifestyle diseases amongst youngsters. Furthermore, hectic schedules due to long working hours are not only affecting their mental well-being but their physical health as well,” said Anuradha Sriram, Chief Actuary Officer, Aditya Birla Health Insurance.
“The primary focus of youngsters between the age group of 25-30 years is to achieve significant growth in life. Unfortunately, their health takes a backseat and eventually their unhealthy lifestyle snowballs into health issues. It is important that youngsters must prioritise their health and prepare themselves financially for the future,” said Sriram.
“Investing in a comprehensive health insurance not only protects against financial irregularities but enables the policyholder to establish a solid fitness regime. Modern health insurance solutions reward the policyholder for maintaining a healthy lifestyle and enables him/her to set fitness goals,” she added.
Sriram lists the following advantages of buying insurance at a young age:
Low premium at a young age
It is advisable that planning, savings and investments should start as early as possible. Same goes for health insurance too. One should invest in a health insurance plan early in life because at a young age, the chances of having medical complexities are lower, and hence the health cover premium is also lower. There are products that provide early age discounts that can be very valuable in the medium to long term
It is the time duration when you are not allowed to make health claims for certain pre existing diseases, surgeries & special treatments. If a person makes a decision to buy health insurance at a young age, he/she will not be impaired by such waiting periods.
A health safeguard for your life
Like any other commodity that needs protection to survive external damages, health insurance protects the insured from the financial uncertainties arising out of medical emergencies. While health emergencies might be rare at a young age, one still needs to be prepared for the unexpected. Also, the pandemic has demonstrated that many health exigencies can be outside one’s control while creating a significant financial strain.
Duration of your health cover
There is always an age criteria that one needs to comply with while buying a health insurance plan. Buying health insurance at a young age protects the insured for a longer period compared to those who are buying health insurance at 40-50 years. Also, there’s a chance that insurers might reject the application or load additional premium payable if the insured is of old age and/ or has a poor health condition.
Brings financial stability to your life
One of the major benefits of buying health insurance is that it provides financial stability to the insured’s life. By paying a small amount of premium, one can hedge themselves from financial irregularities arising out of unexpected medical expenses
No Claim Bonus
No claim bonus assures bonus money which gets added to the sum insured for every claim free year. Since there are always fewer chances of major disease & health-related problems at a young age, policyholders can gain the benefit of a no claim bonus for a longer period, providing inflation proofing for increase in medical expenses in the future.
The premium amount in a health insurance policy is tax-deductible under section 80D of the Income Tax act. Hence you can claim an additional tax saving benefit, (subject to change according to the tax laws)
To protect the policyholders from health related expenses, the insurers have introduced a range of additional benefits attached to health insurance policies which are commonly known as health riders. Health riders enables the customisation of an existing policy to suit the needs of the insured at a very low price.