Gen Z's guide to health insurance: Here is everything you need to know and why

While chronic illnesses like diabetes hypertension and obesity are on the rise among the young the awareness of health insurance in Gen Z is considerably low Additionally the skyrocketing costs of healthcare services make health insurance education even more crucial than ever Experts believe that Gen Z must get themselves insured as early as possible for the best support However determining which health insurance suits best for you and the process of getting yourself insured can be easily overwhelming Middaycom roped in experts from the health insurance sector to seek key insights on the same atOptions key d0ddb8ef8f1a62a8cdd22fac27fc5ea7 format iframe height 90 width 728 params Syed Meraj Naqvi CEO and principal officer Riskbirbal Insurance Brokers tells Midday readers ldquoImagine this you are young and healthy enjoying your life Suddenly an unexpected illness strikes Hospital bills pile up medications become a burden and your savings dwindle In such situations health insurance acts as a protective shield It helps cover significant portions of medical expenses including hospitalisation costs surgeries and often even prescription drugsrdquo Need for health insurance from a young age Shilpa Arora cofounder and chief operating officer Insurance Samadhan highlights ldquoMedical inflation stands at 14 per cent in India The cost of treatment has increased significantly Unfortunately this is making quality and timely treatment beyond the access of many while the limited number of individuals getting treated are often left with a massive financial liability For instance even minor surgery can cost up to one lakh rupees Additionally in India the lsquoOutofPocket Expenditurersquo the direct payment of money by an individual for healthcare services or goods stands at 471 per cent which is relatively higher than most countries These aspects make it imperative to purchase a health insurance policyrdquo The earlier you enroll in a health insurance plan the better Arora advises starting as early as possible or as soon as one turns 18 ldquoWhen it comes to health insurance or insurance in general those who purchase an insurance policy at a young age tend to benefit in more than one way For instance most insurance companies consider young applicants healthier than older adults due to their lower vulnerability to ageinduced complications or chronic illnesses making them lower liability As a result insurance providers offer comprehensive coverage at a lower premium amount than what an older adult would typically payrdquo ldquoSimilarlyrdquo she adds ldquoyounger adults are subject to less scrutiny when buying a policy For instance some insurers may not require a prepolicy medical checkup if the applicant is very young However this clause may differ from company to company Some health insurance products also offer a cumulative bonus for every nonclaim year Such a bonus often helps increase the sum insured without any additional cost Since younger individuals are deemed less likely to raise a claim during the policy year they may become eligible for a claim bonusrdquo Nikhil Apte chief product officer Royal Sundaram General Insurance Co Ltd tells Middaycom ldquoTypically up to the age of 25 a child is covered under family floaters after 26 years onward the child is covered as an independent and not in the family floater The real answer to getting covered in health insurance is today because the hard fact of life is that everybody at some stage will require hospitalisation so it is important to start today and get the maximum possible insurancerdquoALSO READ Forced to be happy at all times How Gen Z is battling toxic positivityEvolution of health insurance packages postCovid19 Traditionally health insurance focused primarily on reactive care covering hospitalisation and major medical interventions However the healthcare landscape is evolving Naqvi informs ldquoWith the rise of chronic illnesses like diabetes and hypertension a proactive approach is gaining traction Insurers are now offering plans with wider coverage for specific treatments and medications related to these conditions Additionally some plans are incorporating wellness benefits like gym memberships nutrition consultations and preventive screenings encouraging a holistic approach to healthrdquo Arora shares some key insights A quick look at the latest data would show how the cases of diagnosed diabetes and hypertension are on the rise among young adults For instance there are around 77 million individuals above the age of 18 years who are suffering from diabetes type 2 while nearly 25 million could be prediabetics On the other hand in India more than one in four have hypertension These trends are concerning and could add pressure on both policy buyers and insurance providersShe says ldquoPreviously health insurance premiums were determined based on the applicantrsquos age and gender However considering the changing health and lifestyle trends more companies are factoring in chronic illnesses to assess applicantsrsquo risk profiles and set premiums As a direct impact the premiums for younger adults with preexisting conditions are becoming more expensiverdquo Today many insurance providers offer plans specifically designed to cater to these chronic health concerns These plans factor in individuals need to undergo regular checkups and consultations to build a comprehensive plan that would focus on chronic management and outpatient needs to help ease medical costs Hence most plans accompany benefits that help tackle expenses related to regular checkups tests consultations diagnosis and medicine purchases along with standard benefits Ramit Goyal chief distribution officer Future Generali India Insurance Company Ltd reveals interesting figures The Indian healthcare market which was valued at 116 billion in 2016 is projected to reach 638 billion by 2025 The healthcare landscape in India has undergone a significant transformation over the past decade particularly in the years following the Covid19 outbreak The pandemic has brought about a major shift in consumer behaviour with individuals realising that health is an asset that needs financial protection One of the key changes that the industry has witnessed is the growing preference among consumers for higher sum assured Say for instance even till a few years back a policy with five lakh rupees insured was the most popular choice among people but today health insurance plans with a higher sum insured say from Rs 10 lakh and above seem to be the preferred option Another important point that Goyal mentions is that health insurance today is no longer just restricted to physical but also the mental health of individuals READ ALSO The unsung heroes Health insurance denied for autistic son mother sheds light on systemic issueMental health and health insuranceGoyal shares ldquoNearly 14 per cent of the global burden of disease is attributed to neuropsychiatric disorders In India it is estimated that 20 per cent of our population suffers from a mental illness and only 1012 per cent of them seek aid for their mental health concernsrdquoThough the level of awareness is still low in the country it is steadily gaining traction with people recognising the need to address the issue effectively Insurance companies have been quick to understand this need and provide coverage for mental health in their policies He adds ldquoThe Mental Healthcare Act of 2017 mandates health insurance policies to include mental health conditions just like physical onesrdquo Countering this Arora states ldquoDespite the mandate the practical coverage and access to it has massive gaps which often complicates things for patients For instance almost all health products list selfharm suicide and attempted suicide as exclusions Additionally getting claims related to hospitalisation due to cases of mental illness settled is deemed difficult Similarly there are several cases when individuals face challenges to avail of a policy cover due to their preexisting mental illness This is also a reason why most individuals wish to keep their psychiatrist consultation off the record as they fear their claim for other health conditions would be denied if they declare their mental health issue in the policy formrdquo ldquoSuch a practicerdquo Arora states ldquonot only withholds crucial information from the insurer but also increases the policy buyerrsquos chance of rejection However these issues highlight an urgent need for simplifying the clauses related to mental health insurance and easing exclusions to help individuals avail of coverage and address their concernsrdquo Tips to educate yourself about health insuranceRahul Mishra director and cofounder of Policy Ensure recommends that Gen Z educate themselves about health insurance through online resources webinars and financial literacy programs He says ldquoUnderstanding the nuances of health insurance early on can lead to more informed decisions and better financial planningrdquoSimilarly Naqvi says ldquoResearching online through insurer websites and comparison platforms is a great starting point Additionally talking to parents or other adults about their experiences with health insurance can be immensely helpful Dont hesitate to seek guidance from insurance agents or financial advisors who can clarify complexities and recommend suitable plans based on your needsrdquoREAD ALSO A beginners guide to saving and investing in your 20sKey factors to consider before making a final choice Both Naqvi and Apte share some key factors you must consider before buying an health insurance plan 1 Coverage This is what the plan actually covers Look for a plan that includes hospitalisation outpatient care doctor visits clinics and coverage for critical illnesses like cancer or heart disease2 Sum insured This is the maximum amount the insurance company will pay towards your medical bills per hospitalisation Choose a sum insured that adequately covers potential hospital costs in your area For example a 26yearold Gen Z may find Rs 20 lakh as a very high sum insured initially however considering the longterm nature of the policy it will help get about Rs 4050 lakh of coverage3 Network hospitals Check if the plan offers access to quality hospitals and clinics in your area Convenience and familiarity with your preferred healthcare providers are important factors4 Claim settlement ratio This ratio indicates how quickly and efficiently the insurance company settles claims A higher ratio suggests faster claim processing which is crucial during medical emergencies5 Renewability Ensure the plan allows for renewal throughout your life even if you develop preexisting conditions later This provides longterm security and avoids the risk of losing coverage when you need it most6 Maternity cover Policies that cover maternity benefits should be considered as this later adds up to outofpocket expenditures if not covered under the policy7 Room rent restrictions and diseasespecific restrictions When you land in a hospital you might not have control over which room you are allotted and therefore technically the policy should not have limitations on room rent capping and disease capping which may result in a shortterm premium decrease but ultimately when the person gets admitted there will be higher outofpocket expenses Bonus Tip Consider adding optional riders to your plan These are like addons that provide extra coverage for specific needs such as critical illness While they come with a small additional cost they can offer valuable peace of mind in case of unforeseen circumstancesCommon mistakes to avoidldquoCommon mistakes young adults make when signing up for health insurance include underestimating the coverage they need ignoring the terms and conditions and choosing the cheapest option without considering the benefitsrdquo states MishraNaqvi lists down in detail some common mistakes you must avoid making 1 Ignoring the fine print Understand key terms like deductibles the amount you pay upfront before insurance kicks in copays fixed fees for certain services and coverage exclusions what the plan doesnt cover Read the fine print carefully and ask questions in case of any confusion2 Thinking you donrsquot need health insurance Thinking youre invincible and wont need insurance is a gamble Accidents and illnesses can happen to anyone and the financial burden can be significant Protect yourself from unexpected costs3 Ignoring the coverage of mental health Dont overlook the importance of mental health coverage Look for plans that cover outpatient therapy sessions with licensed professionals Mental wellbeing is just as crucial as physical health 4 Preexisting condition pitfall Hiding preexisting conditions can backfire Be honest with your insurer to avoid claim denials later5 Price over value Dont be solely swayed by the cheapest plan Consider the overall value proposition A slightly more expensive plan might offer a wider network of hospitals or better coverage ultimately saving you money in the long run atOptions key d0ddb8ef8f1a62a8cdd22fac27fc5ea7 format iframe height 90 width 728 params