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Rediff.com  » Getahead » A critical illness cover is also for Millennials

A critical illness cover is also for Millennials

By Mukesh Kumar
May 14, 2016 12:45 IST
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Most Millennials do not realise the importance of having a critical illness insurance policy till they find themselves or their near ones in circumstances where they need it. A little extra caution -- by way of critical illness insurance -- can save the young professionals from a large hole in the pocket in the time of accumulation of wealth, says Mukesh Kumar, Executive Director, HDFC ERGO General Insurance Company

Millennials tend to ignore all kinds of medical health insurance coverage. However, due to the compulsions of working professionals’ lifestyles, it is becoming essential to get covered under a health insurance plan that covers new-age health problems increasingly found among young professionals.

Fiercely competitive corporate environment, extended working hours, unhealthy food habits, lack of exercise, never-ending stress and unhealthy habits such as smoking and alcohol are becoming routines (or compulsions) of professional lives today. These factors have resulted in young working professionals falling victim to the lifestyle-related disorders and illnesses. And this is relevant to both male as well as female professionals.

There has been slow but real transformation in the incidence of critical illnesses among Indian population. Reports state that one in three persons will develop some life-threatening cancer; one in four persons will develop heart disease before they retire, and one in twenty people risk the chance of having stroke before the age of seventy! These predictions are alarming for the young generation. Unfortunately, most young working professionals may not be prepared to face the financial burden if -- god forbid -- they develop any critical illness today.

Millennials are generally not interested even in the regular health insurance and most cannot tell how critical illness insurance is different from a regular health insurance. Most Millennials do not realise the importance of having a critical illness insurance policy till they find themselves or their near ones in circumstances where they need it. However, with changing times, it is necessary that working Millennials understood the product better and secured themselves against such possibilities.

It is not rare these days for young professionals in late-twenties and early-thirties to get diagnosed with medical conditions that require specialised care. In the event of a critical illness such as cardiac attack, bypass surgery, cancer, stroke, multiple sclerosis or renal failure, the financial burden could be far more than what a regular health plan that pays hospital bills would cover. A critical illness for a young working professional with dependents means loss of income, total or partial incapacity and change in lifestyle.

Typically, a regular health insurance plan has limits on doctors' fees and, thus, does not cover the full cost of treatment. Also, there are caps on specific expenses such as on medicines, intensive care unit or prosthetics and the hospitalisation bill would invariably be more than what the insurer will pay. In such cases, individuals have little option but to pay from their own pockets. A little extra caution -- by way of a critical illness insurance -- can save the young professionals from a large hole in the pocket in the time of accumulation of wealth.

With medical costs spiraling out of control for ailments like stroke, hypertension, cardiac arrests etc., it has become imperative for the young working professionals to plan for such eventualities to ensure that their families’ life is not disturbed.

Treatment of Critical Illnesses is more expensive than other general ailments. For instance, Herceptin, an effective breast cancer drug, costs around Rs 57,500 for a 440-milligram vial, while a 150-milligram vial costs Rs 19,500.

Cancer patients need around 6 to 17 vials for reasonable treatment. The cost of coronary bypass surgery typically costs in excess of Rs 2.5 lakh-Rs 3.75 lakh in a city like Mumbai. Similarly, an angioplasty can costs around Rs 1 lakh to Rs 2 lakh depending upon the type and number of stents being used, or where it is get done.

Most critical illness insurance plans are designed in a way that they take away most medical worries of young working professionals.

A standard critical illness insurance policy pays a lump sum benefit (up to the sum insured opted) on the very first diagnosis and a minimum survival period.

The best part of this plan is low premium. A young working professional of 30 years can get a critical illness insurance of Rs 5 lakh for an affordable premium of less than Rs 2000 per annum.

A discounted premium for two years works out even lower for the same plan. At an affordable premium, it's a must buy for the young working professional!

A standard critical illness policy provides a lump sum benefit which can pay for the costs for the care and treatment; recuperation aids; or to pay off debts.

A critical illness policy pays a lump-sum, up to the sum insured, on first diagnosis of any of the following critical illnesses, after a 30-day survival period from the date of first diagnosis.

Photograph: sandeepachetan.com travel photography/Creative Commons

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Mukesh Kumar