With the rising medical inflation, it is practical to opt for products that help in reducing the financial burden during a medical emergency. To that end, insurance companies in India offer health insurance plans. A medical insurance policy comes with several benefits that work in favour of an individual getting treatments from hospitals and medical centres.
However, buying an insurance policy at various stages of life has several advantages. After going through the benefits and perks of purchasing medical insurance at different ages, one can easily figure out the best time to buy such a plan.
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Buying health insurance at a younger age
One can obtain health plans as early as possible for a range of benefits. Moreover, minor individuals can enjoy coverage benefits under a family medical insurance policy obtained by their adult family members.
However, settling for an insurance plan on turning 18 has its own set of perks, as mentioned below:
- Cheaper policies
Various factors like deductible and co-payment, sum insured amount, pre-existing medical coverage and add-on benefits determine the policy premium. Along with this, age becomes a vital consideration for insurance companies.
As older individuals are prone to diseases and other medical conditions, their chances of filing claims become much greater. Considering this, insurers offer health plans at an increased premium price to these people.
Alternatively, potential buyers at a younger age can obtain medical insurance at cheaper rates.
- Convenience in getting over the waiting period
Policyholders of health plans need to complete a waiting period of 30 days before raising claims (except in case of accidental hospitalisation). In this regard, older individuals find it difficult to wait this long for coverage benefits during medical emergencies. It leads to early claims from their end, which has an increased chance of rejection.
However, the severity of diseases or any other condition in the case of a younger policyholder is less, allowing them to get over this period easily.
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- Higher chances of accumulating cumulative bonuses
Insurance providers offer cumulative bonuses to policyholders maintaining claim-free years within their policy term. As younger individuals are less likely to contract diseases or face medical emergencies, they can easily accumulate these bonuses.
The sum insured under a health policy increases with each passing year due to the accumulated cumulative bonus. It results in an extended coverage limit under a medical insurance plan.
- Tax exemptions
On paying premiums for a health plan, one can enjoy income tax deductions of up to Rs.25,000 per year, as per Section D of the Income Tax Act, 1961. Buying this policy at an early age helps increase the net tax savings. Thus, one should be aware of the health insurance tax benefit before applying for one at a younger age.
| Category of policyholders | Tax exemptions |
| Policyholder and their family including spouse and unmarried children | Up to Rs.25,000 |
| A policyholder and family along with parents below 60 years of age | Rs.25,000 for self and Rs.25,000 for parents |
| Individuals, their family (where the eldest member is less than 60 years of age), including parents above 60 years of age | Rs.25,000 for policyholders and Rs,50,000 for parents |
| Policyholders and their family where there is the eldest member above 60 years and parents above 60 years | Rs.50,000 for self and Rs.50,000 for parents |
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Thus, by obtaining a health policy at an early age, one can continue saving taxes for a more extended period.
In addition to this, individuals can obtain a deduction of Rs.5000 on preventive health check-ups.
Buying health insurance in the mid-twenties and thirties
Purchasing a health plan in the mid-twenties is ideal as individuals start out with their career at this stage without any additional liabilities. At this stage, a medical insurance plan will not interfere with a policyholder’s financial goals.
Other than this, one can avail of a lifetime renewal facility along with extended coverage by obtaining insurance at this age. It also acts as a backup plan during medical emergencies. Further, individuals in their mid-twenties planning to start a family will also benefit from a health plan. They can get add-on covers that offer coverage benefits after a certain period and pass this duration in a hassle-free manner.
Similarly, obtaining medical insurance in the thirties comes with a host of benefits as individuals plan out their future at this stage. It also becomes convenient for potential buyers to invest in insurance plans at this stage as they are financially secured.
Further, individuals in their thirties can also include family members under a floater plan and get coverage benefits during medical emergencies.
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Buying health insurance above 60 years old
A health plan probably becomes an essential tool when an individual reaches 60 years. At this stage, they are more likely to suffer from diseases that require emergency hospitalisation and vital treatments. Paying for these can get relatively difficult as one does not have a steady income at this age. Thus, it is imperative to obtain mediclaim policies or health plans and cover the exorbitant medical costs.
However, insurance companies charge a higher premium price from older individuals as they are prone to make more claims.
Nevertheless, special plans like senior citizen health insurance are available that come with additional coverage. Some of them include AYUSH treatment cover, domiciliary care benefits, hospitalisation due to psychological disorders and more.
To conclude, it is evident from the aforementioned piece that medical insurance offers a range of benefits at different life stages. Based on age, one can get insurance coverage and enjoy coverage benefits without worrying about the financial burden. However, the earlier an individual obtains such a policy, the more benefits they can expect in terms of tax benefits, affordable insurance premium rates and more.
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