Post retirement life is considered to be full of relaxation, pursuit of hobbies and meeting old friends. However, it is critical that senior citizens not only pay close attention to their health but also the cost of health related expenses. However seniors do tend to exhibit reluctance about buying health insurance. They feel it is not a worthwhile investment and instead would be waste of money.
Here are 10 reasons why it is important for senior citizens to buy health insurance
Life expectancy is increasing
The rise in life expectancy among Indians has been substantial. From 58 years in 1990 to 68.3 years in 2015, the increase has been remarkable. Over the next few years, this will only keep increasing. However, this trend also brings with it, the importance of having a relatively incident free old age. Over a period of time, one may discover that there is a post retirement life of close to 25 years that lies ahead. The simple fact of probability dictates that this would certainly be filled up few hospital visits on account of accidents or illnesses. Therefore it is imperative that senior citizens don’t view health insurance as an expense and rather look at it as a viable investment of protection.
Be Independent
Earlier retired parents would feel that their children are completely responsible for their well-being during old age. Joint families were the norm and some or the other family member would be at the beck and call of senior citizens. However times have changed. Proliferation of nuclear families, immigration of children to other cities and countries for better opportunities and general change in culture is resulting in several retired parents living by themselves. And many of them welcome this change too as they prefer their independence. Therefore it makes perfect sense for them to continue being independent by investing in a bulletproof health insurance policy and not depend on anyone else for footing medical expenses.
Don't break nest egg
Senior citizens are most likely to have a nest egg to depend on during their post retirement years. This may be a combination of their savings, provident fund and gratuity. This nest egg enables senior citizens to live independently without worrying about securing their own needs. They can also use this nest egg to purchase gifts for their loved ones. Apart from one’s house, which would be most probably owned by retired seniors, the nest egg is a reflection of one’s dedicated and industrious career. However, a couple of instances of hospitalization can not only cause a huge dent to one’s nest egg but may also obliterate it.
Peace of mind for family members
Family members of seniors who get hospitalized not only worry about their well-being but also turn tensed about impending medical bills. Sometimes this also leads to temporary discords in family relationships. This may result in bickering about which family members has to pay how much to foot medical bills. Owning health insurance brings about substantial peace of mind to both seniors and their family members.
Legacy/Inheritance for family members does not get impacted
Seniors in India prefer their family members to inherit their wealth after passing on. Inheritance could include both real estate as well as financial holdings. In the absence of health insurance, these financial holdings could be wiped out in case of prolonged and multiple hospitalization. A senior may feel immensely let down and may carry the burden or unwanted stress and disappointment in not being able to do anything for the next generation’s aspirations.
Some ailments could be chronic and therefore may need repeated hospitalization
Ailments such as diabetes, lung diseases, hypertension etc are chronic and therefore would require repeated hospitalization. In fact 65% of seniors suffer from chronic ailments. Around 33% suffer from atleast 2 chronic ailments simultaneously. Even a single visit to a hospital could invite significant expenses. Added to this would be the regular outflow of money towards medicines and regular check-ups which cost Rs 500 and Rs 600 respectively.
Treatment for critical illnesses would be expensive
Average cost of breast cancer treatment has grown from Rs 1.5 lakh in 2000 to Rs 6 lakh as of 2015. For all other types of cancer treatment, rise in treatment costs has inflated by 300% to 400% over 15 years. This also causes immense economic burden as many families are forced to borrow at prohibitive interest rates. In fact, six cycles of chemotherapy can cost as high as Rs 20 lakh. Disturbingly 10 lakh new cases of cancer are reported in India every year as per World Health Organization (WHO). These numbers are alarming
No compromise on the quality of treatment
Our government spends hardly 1.2% of the GDP on healthcare. This can be compared to the Draft National Health Policy 2015 released by the government which advocates spending of at least 2.5% on public healthcare. Low budgets and and lack of transparency lead to shortage of vital equipment, overworked staff and general mismanagement. This keeps most of us away from public hospitals. A leading consulting firm released a report which highlighted the difference in cost between branded and unbranded hospitals. The cost was difference was almost a lakh. Thanks to fine print almost every aspect of the service offered by a hospital, right from the space where one is wheeled to before x-ray to mattresses, is chargeable. In fact, one shouldn’t be surprised about spending at least Rs 40,000 for any procedure in a private hospital. Most families prefer private hospitals as the state of public hospitals in our country is not up to the mark. But this results in higher hospitalization expenses.
Being included in family floater plan makes it expensive
Seniors also end up finding themselves as a part of a family floater plan. Inclusion of senior citizens makes the family floater plan expensive. In fact, including an individual above the age of 45 in a family floater plan isn’t recommended. Chances of a senior suffering from a serious medical ailment is higher and the entire sum insured may get exhausted while offering coverage to just the senior’s medical expenses. The No Claim Bonus clause offered by a family floater plan may also get impacted if the senior requires frequent hospitalization.
Higher Tax Benefit
Who doesn’t love to save taxes? Especially senior citizens who may have to pay tax if they are receiving income through their deposits or pension or both. Some of them may also be employed and therefore would be required to pay tax. However, they can claim additional tax deduction on payment of health insurance premium thanks to a new announcement made in budget 2018. Earlier seniors could only claim up to Rs 30,000 for tax deduction under Section 80D of the Income Tax Act. Now, this amount has been increased to Rs 50,000. Therefore even if health insurance premium seem to be expensive, they offer attractive tax benefits.
By purchasing individual health insurance policies for themselves, senior citizens are not only safeguarding their own interests but also ensuring the well-being of their family members. At the outset it may seem expensive to purchase individual health insurance policies as seniors, but even a single bout of hospitalization would make one feel that investing in a comprehensive health insurance policy was certainly worth the while.
