Why do Young Adults need to have both a health and life insurance Policy?
Some of the Young adults and Gen Z are emerging as a financially responsible generation. This financially savvy generation sees health insurance as a shield against unexpected medical bills and views it as a key investment. However, if you still think “I’m young, healthy, and fit. “Why do I need health insurance?” then this article is certainly for you.
While it may seem counterintuitive, the best time to purchase a life insurance policy and health insurance is while you are young and healthy. When you acquire these two policies at a young age, not only you will get coverage at a low price but are also less likely to have any pre-existing diseases. Here, we will be discussing the top reasons to purchase health insurance at a young age:
1. It is an investment for your future
We all know the expenses of medical treatment continue to climb. The epidemic reminded us that hospitalization costs are not always affordable and making a small investment in your health now can pay off significantly when you need it the most. A decent health insurance plans not only provides crucial financial coverage during an illness, but it also gives you peace of mind knowing that you do not have to manage medical bills on your own. In other words, comprehensive health insurance coverage is a vital part of a sound financial strategy.
2. Your money has sufficient time to grow
When you get a life insurance policy at a young age, your money has more time to grow. As a result, investing in your twenties increases the death or maturity benefits that you will receive at the end of the policy’s term. For example, if you get a life insurance policy at age 25 and continue to pay premiums until age 60, your money will have 35 years to accrue into a retirement fund. On the other hand, if you acquire the same life insurance policy at 40, you only have 20 years to grow your funds. In other words, investing early can increase the cash value of your investment in the long run.
3. No need for medical exams
If you are young and considering purchasing health insurance plans and a life insurance policy for yourself or your loved ones, it is unlikely that you will be required to undergo medical exams in order to obtain the necessary coverage. Even if you had to go through one, it will be less likely you will have any pre-existing illness.
Most insurance firms require policyholders to undergo comprehensive medical examinations if they are over a particular age.
4. Tax Benefit
A further incentive to invest in life insurance and health insurance plans is the tax advantage. Section 80D of the Income Tax Act allows you to claim deductions for the premiums one pays for their health insurance policy. While such tax benefits are available to elderly citizens, investing in health insurance plans early allows you to take advantage of them for a longer period of time. Section 80D allows you to claim a tax deduction of up to Rs.25,000 for purchasing health insurance for yourself, your spouse, and your dependent children. You can get an extra Rs.25,000 if you buy health insurance for your parents. If your parents are older than 60, the ceiling rises to Rs.50,000. That implies you might potentially save Rs.75,000 on your taxable income while giving those you care about the safety they require.
The same applies to life insurance policy. Section 80C of the Income Tax Act states that the premium paid for life insurance during a financial year is deducted from the total taxable income. This benefit can be claimed for premium payments up to Rs. 1.5 lakhs every fiscal year. So, if your annual premium payments total Rs. 1 lakh, you can deduct the entire amount from your income. This, in turn, reduces your tax liability. If you acquire life insurance when you’re younger, you can benefit from a lower tax burden at a time when you most need it.
5. Lower premiums
It goes without saying, that the younger you are, the lower your premiums are going to be. Insurance companies give health insurance to people as young as 91 days old. Purchasing insurance early also means potentially more coverage, no pre-existing conditions, lifelong renewability, and the ability to simply navigate the waiting period.
6. Lower rejection rate
When you purchase a health insurance plans coverage at a young age, you are less likely to have any major illness or disease than individuals over the age of sixty. As a result, young individuals are less likely to file claims in the eyes of an insurance company. Also, it reduces the possibilities of your claim being rejected, as in the case of old people.
As young adults begin their road towards independence and self-reliance, getting health insurance and life insurance policy may not always be at the top of their considerations. Regardless of your age, purchasing an insurance policy is a wise decision. However, recognizing the significance of these two insurance policies during these formative years, on the other hand, is an important step towards ensuring the well-being and financial security of your own and your family members. Also, purchasing when you are young and healthy can be more beneficial in the long run.
