Shravan is a 26-year old engineer with great plans and hopes for his future.
He is doing well in his career and is in the pink of his health.
He believes he cannot fall sick any time soon. So, he does not see the need for a health insurance plan at the moment. He can buy one later in his life when he needs it more.
But is this really true? One cannot predict a health emergency – an accident can happen anytime and vector-borne diseases can strike regardless of your age. Being completely defenceless against various illnesses is not a risk worth taking.
Not convinced yet? Here are five reasons why you must get health insurance in your 20s.
While it is not a guarantee, 26-year old Shravan is unlikely to suffer from conditions like heart disease, diabetes, etc. Therefore, the insurer considers him to be a lower risk compared to a 40-year old. The young are unlikely to have a significant medical history.
Further, a 26-year old would likely pay many more premiums over his lifetime compared to an older customer. This allows the insurer to charge a lower premium to a younger policyholder compared to an older policyholder for the same coverage.
This means if you buy a policy at a young age, you get the best coverage possible at a significantly lower price. Moreover, buying health insurance early gives you more time on the plan. This way, you can accumulate benefits over time which would be useful at a later age.
The reason that insurance providers require health check-ups is to know your current medical condition and assess health risks. It also allows them to assess any major illnesses that you may be currently suffering from.
However, no medical tests are required when you are young and have no prior medical history. Most insurers do not require medical tests until the age of 40 years.
Young buyers like Shravan should take advantage of this and get a health insurance policy at the earliest. The process will only get more complex with delays.
All health insurance plans have waiting periods and they are of different types.
For instance, there is the initial waiting period of 30 to 90 days wherein no medical expenses are covered, other than those related to accidental injuries.
Then there is the waiting period for pre-existing and another waiting period for specified diseases. These usually last for 2 to 4 years.
However, when you are young, these waiting periods do not matter as you are healthy and likely have no pre-existing illnesses. You are unlikely to suffer from any of the specified illnesses either. Of course, you might suffer from these conditions later on in life – but by then you are likely to have satisfied the waiting periods and have access to the coverage you need.
As you enter corporate life, you are likely to get a group health insurance cover from your employer. While this cover can be very useful, it is rarely sufficient to meet all your medical expenses in case of an emergency.
On average, a corporate plan provides coverage up to Rs. 2 lakhs. While this will help cover a lot of costs, you may find that it gets exhausted very quickly in case of an emergency.
Therefore, you should buy a personal health insurance policy to protect you from rising medical expenses. You can choose a sum assured that complements your corporate policy & ensure that you are never without a cover.
It is important to note that corporate health insurance is only valid until you are with the company. This leaves you vulnerable when you are between jobs. Getting a health insurance policy for yourself helps bridge this gap as well.
In addition to covering the skyrocketing prices of healthcare, health insurance can also provide you with tax benefits. As per section 80D, Income Tax Act, 1961, The premium you pay from individual or family health insurance can be claimed as a tax deduction on your total income. Moreover, there are separate deductions for including parents in your policy and for preventive health check-ups.
Now, young individuals have many short-term and long-term goals in life. Maybe they want to take an international trip each year or start making an investment portfolio, the options are endless. However, after paying all your bills and taxes, there may not be much money left to do so. However, buying health insurance at a young age can help you.
If you buy a health policy early, you have a longer time to accumulate your tax benefits. The more years you qualify for a tax deduction, the more money you save. When it comes to buying health insurance, young individuals often wonder ‘do I need health insurance’?
However, in today’s time, the truth is that no one can manage without it. While it may be a distant future for you, everybody ends up needing a trip to the hospital at some point. Hence, it is always better to be prepared with a decent health insurance policy.
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