The growing importance of Health Insurance coverage for the younger generation

Insurance

oi-Sunil

By Sunil Fernandes

Published: Wednesday, August 6, 2014, 10:46 [IST]

The growing importance of Health Insurance coverage for the younger generations "Youth offers the promise of happiness, but life offers the realities of grief'', wrote a famous author summarizing the true essence of life. The quote finds relevance in all spheres of our life including our disposition towards health insurance. Youth is considered to be the best period of one's life whereone throws caution to the winds. Who cares about being careful when driving fast cars and/or leading extravagant lifestyles is the trend. As such, financial planning, saving for retirement, planning for health related contingencies take a backseat. However, planning your finances early in your life is prudent.

The same goes for health insurance although it sounds strange buying a health plan at such a young age because the prospect of falling ill is preposterous. Current trends show that lifestyle diseases are taking a toll on Indian youth. Quotes Shivinder Mohan Singh, executive Vice- Chairman of Fortis,'' the health of youth is getting affected by three factors:

"People are getting busier with their jobs, technology is leading to changes in sleep and lifestyle patterns, and with more disposable income health has taken a back seat as they give attention to other things."

The same sentiment is expressed by other industry experts who urge the lower generations to invest in a sound health plan. Thus, here are the reasons why the young (age - 18-30) should buy a health plan: It is cheaper- this is no rocket science. The younger you are when you buy a plan, the less risk you present to the insurer and the cheaper the premium you will be charged. Since the chances of claim are very negligible when you are young, your No Claim Bonus will also accumulate and your subsequent premiums will be lower.

Medical inflation- inflation is a demon which eats away at your savings. The medical costs are also spiraling upwards and demand a sound contingency fund so that it does not burn a hole in your pocket.

Critical illness- nowadays, the modern youth is facing the risk of various critical illnesses. Heart related diseases, asthma, cancer are very commonly prevalent among the younger generations. The insurance companies reported a surge in claims from 15.8% in 2004 to 47% in 2012. Surprisingly, the majority of claims were raised by the age group 26-35 years.

Guaranteed renewability for life- earlier people did not consider buying a health plan before 35-35 years. The argument- the plan will expire at 65 years so why hurry? IRDA has passed a directive making all the health plans renewable throughout lifetime. So, your plan will cover you up to your lifetime so start planning early.

Your employer provided group insurance is not sufficient- it is often contested by the employed population that since their employers provide a group health plan, an individual plan, especially at a young age is not required. While many agree, there is a catch in the above argument. Though you may be a part of a group health plan, it is not exhaustive. It is a very basic plan which does not provide for a customized cover which may be needed as per your requirement.

Get rid of the pre-existing clause- When you start young, you are more or less fit. As such your policy would not exclude any ailments from the scope of coverage under the pre-existing clause. By renewing your plan every year, any ailments you develop will also be included in your cover and any cost incurred for the same will be met by the insurer.

To conclude, the above reasons should come as an eye- opener for the modern youth. They outline the importance of a health plan at an early age. So don't turn a blind eye and opt for a health plan early in your life.

Written By: Deepak Yohannan

The author is the CEO of MyInsuranceClub.com, an online insurance price & features comparison portal

For more articles by Deepak Yohannan, please visit MyInsuranceClub.com

You may contact him directly on Twitter: @dyohannan