What is the right age to purchase health insurance?

Published: September 20, 2019 3:33 PM

Buying health insurance at an early age allows you to accumulate the cumulative benefits by the time you are older when you can avail of higher coverage.

Health insurance plans, Health insurance , sum assured, Co-payment , deductible, Pre-existingHealth insurance plans offer the financial stability required during trying times, thereby allowing you to focus on the treatment.

By Eswaranatarajan N

It is a common belief that when you are young and healthy, there is no need to avail of health insurance coverage. However, today life is fast-paced and erratic with unhealthy eating habits and irregular or lack of exercise. As a result, there is an increase in lifestyle-related illnesses striking at a young age.

Medical science has seen significant development. Therefore, treatments and cures are available for most ailments. However, the expenses incurred for such treatments are humongous and may result in severe financial stress if you do not have health insurance coverage.

Health insurance plans offer the financial stability required during such trying times, thereby allowing you to focus on the treatment. Such plans eliminate the financial stress that a severe ailment may cause. The Indian laws allow a person as young as 18 years to avail of health insurance. A child age less than 18 years may be covered under health insurance policies availed by the parents.

Some of the factors that determine the premium on health plans are as below:

  • The sum assured
  • Co-payment and deductible chosen
  • Insured’s age and total individuals covered under the plan
  • Additional riders
  • Pre-existing medical conditions, if any

One of the factors that determine the health insurance premium is your age. Therefore, it is beneficial to buy health insurance at an early age.

Here are five benefits of investing early in a health plan:

1. Affordable premium: When you are young, you are healthy with no serious medical conditions. Therefore, the insurers perceive you as a low-risk policyholder, who has a lower probability of filing a claim under the health plan. Therefore, you are able to procure higher coverage like critical illness insurance for an affordable premium.

2. A higher number of options: At an early age, you have the liberty to compare different health plans offered by the various insurers, thereby allowing you to make an informed decision. Moreover, there is a lower probability of non-acceptance of your proposal. As you grow older, insurers may not offer coverage for all types of ailments, thereby reducing the number of available options.

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3. No requirement of medical tests: If you are old, the insurance companies may make it mandatory to undergo several medical tests and check-ups. The results are analyzed by the underwriters, which in turn determine whether the policy will be issued to you or not. Most health insurance companies do not require you to undergo medical tests when you are young and healthy.

4. Waiting period: Almost every health plan has a certain waiting period during which coverage for pre-existing conditions is not available. Therefore, if you have a medical condition, it is not immediately covered under the policy. Investing at an early age ensures the waiting period is over in case you are diagnosed with any ailment in the future and coverage for the same commences immediately.

5. Lifelong renewal: Insurers may offer lifelong renewal if you purchase the health policy at an early age. This secures your financial stability in case of hospitalization at a later age. However, it is crucial that you renew the policy on or before its due date to ensure continued coverage.

Experts recommend that you purchase a health plan as soon as you are 18 years old. This allows you to accumulate the cumulative benefits (for every claim-free year) by the time you are older, as you can avail of a higher coverage.

(The writer is Sr. EVP, COO (Distribution, Underwriting & Operations, Kotak General Insurance)

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