Covid-19 and impact on senior citizen’s insurance needs

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June 08, 2021 2:15 PM

There is a low interest rate scenario in the country and on top of it, the rising medical expenses owing to Covid-19 has impacted the finances of most of the retired senior citizens.

senior citizen health insurance plan, retirement, retired, rising medical expenses, co-payment feature, senior citizen's insuranceIf you are nearing retirement or on the verge of turning 65, it's better to buy a regular health insurance plan that comes with more options, flexible features than a senior citizen health insurance plan.

The Covid-19 pandemic has hardly left anyone not getting impacted, directly or indirectly. The number of cases may have subsided but it still remains a threat at least in the foreseeable future. As per several studies, senior citizens are considered to be more prone to getting infected with Covid-19 and the possibility of requiring hospitalization is high in them. Already, there is a low interest rate scenario in the country and on top of it, the rising medical expenses owing to Covid-19 has impacted the finances of most of the retired senior citizens.

For those senior citizens who have purchased a health insurance plan, meeting the hospital expenses may not be a concern. However, if one does not have adequate coverage, the policyholder has to meet a portion of the hospital bill from own pocket.

But, at higher age, the premium is typically more than for those who buy medical cover at a younger age. Getting a high cover comes at a high price for the senior citizens and the health cover plans also come with a waiting period because of comorbidities in the seniors. There are exclusive senior citizens health insurance plans that may be explored by them. “Senior Citizens with pre-medical conditions should consider opting for health insurance covers exclusively designed for individuals aged above 60 years, “ says Ankit Agarwal, Managing Director, Alankit Limited.

The exclusive senior citizens health insurance plans generally come with a co-payment feature which requires one to pay a portion of the hospital bill before the insurer pays the rest. They may also have several sub-limits in them or longer waiting periods. And, if such plans don’t have such restrictions, then the premium could be on the higher side.

Also, there are plans that restore the coverage amount once the policyholder has utilized the sum insured in the policy. “Given the higher premium rates, it is crucial to keep in mind that health insurance should provide auto restoration of the sum insured once exhausted during the pandemic or demand lower premiums to contribute, if any,” informs Agarwal.

Buying exclusive senior citizens health insurance plans by children for their parents can save tax for the working adults. “Helping your parents to prepare for a financial crisis is one of the best gifts that you can give to your parents. You can buy a senior citizen policy for your parents that ensures considerable coverage along with tax benefits,” adds Agarwal.

Building up an emergency fund comes handy at the time of need. And, senior citizens too need to make sure they have adequate reserves to tide over financial emergencies. “It is of supreme importance to reserve cash that gives an additional factor of malleability to build helpful strategies in the light of financial crisis. Also, it is important to build a contingency fund to take care of unseen and emergency situations,” says Agarwal.

If you are nearing retirement or on the verge of turning 65, it’s better to buy a regular health insurance plan that comes with more options, flexible features than a senior citizen health insurance plan.

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