You may be at the beginning of your career, starting out in life, figuring out things for yourself. You may not be married yet. You may have no dependants either. You’re in the prime of your life and enjoying peak fitness. Should you be thinking about insuring yourself at this stage?
Surely, falling ill, getting hospitalised, having an accident, etc. would be the least of your worries. Be that as it may, there are still Insurance Plans you can and should have – just to make sure that whatever little risk you’re exposed to is adequately covered. Let’s take a look at your options.
Never go without Health Insurance, ever. Whether you’re single or have dependants, always have a health cover. This is because a health crisis can strike at any point – even if you are in the best of health. Hospitalisation can drain your life savings very quickly, leaving you vulnerable not just in terms of health but also financially. Healthcare costs are also on the rise. If you are young, it is possible that your health emergency costs will exceed your life savings. So why not protect yourself with a health cover? If you’re a 25-year-old individual, you can avail a health cover of Rs. 5,00,000 for an annual premium ranging around Rs. 5,000. Getting a health cover while you’re young is useful in two other ways. One: when you’re young, your premium costs are usually much lower. Two: trying to buy Health Insurance after having a health emergency may prove complicated.
Additional Reading: How To Choose A Comprehensive Health Policy
Life Insurance – ULIPs
Life Insurance is useful to a person who has dependants. It is also an avenue for investment and saving taxes under Section 80C. If you do not have dependants, buying insurance is not an absolute necessity. You can save and invest taxes through other means. A traditional Life Insurance plan such as an endowment plan or a cashback plan may offer you tax savings along with conservative returns. The returns may not match small savings schemes such as PPF, National Savings Certificate, and Kisan Vikas Patra. But if you must have Life Insurance, you can consider a ULIP – a unit-linked insurance policy – that allows you to generate higher returns than traditional endowment plans and small savings schemes. In a ULIP, your premium payments are invested in the debt and equity market, allowing you to earn market-linked returns. You also save tax under Section 80C while simultaneously having a moderate-sized life cover. This allows you to invest for high returns, insure your life, and save tax all through one instrument.
Critical Illness Insurance
Critical illnesses such as cancer and stroke seem to have become commonplace and are occurring to young people more and more. The young are at risk due to sedentary lifestyles, rich diets, exposure to pollution and stressful lives. A critical illness is especially difficult to cope with since its treatment can stretch on for months or years. For example, a typical cancer treatment may start with the treatment of symptoms, followed by diagnosis, which is then followed by a combination of surgery, chemotherapy, and radiotherapy. If you do not have a health cover, your financial resources will be drained quickly during a critical illness. In order to boost your health cover, there’s also a critical illness cover that offers to pay a lump sum upon the diagnosis of your illness, subject to terms and conditions. This lump sum payment ensures that your treatment is not derailed for want of funds.
Additional Reading: Introduction to Critical Illness Plans
If you own a car or a four-wheeler, it is your duty by law to maintain a third-party Vehicle Insurance Policy. However, we urge you to go for a comprehensive policy instead of a plain vanilla third-party insurance policy. Third-party insurance is meant to cover damages caused to the third party – which is any person apart from the insured (you) and the insurer. To cover damages caused to you and your vehicle, a comprehensive insurance product is needed. If you’re young, it is likely that you are inexperienced as a driver, which means that you may be accident-prone. Therefore, always have a comprehensive insurance to minimise your losses in case you were involved in an accident.
Being young and single and not having dependants may mean that you have not even begun thinking about your insurance needs. But you should. You should consider buying some of the above-mentioned Insurance Plans at the earliest and ensure peace of mind for yourself.