Youth today understands the importance of early financial planning and opt for multiple ways and mediums to grow their money. Along with increased interest towards investment in mutual funds, FDs, and real estate, considerable interest is generated by the IPOs of new-age start-ups. However, insurance protection is one significant investment tool that can create a safety net for wealth creation planning for youth.
Here’s what Aftab Chaz, associate director and business head at Elephant.in, insurtech consulting and advisory platform for corporate employees and businesses, suggests about the insurance.
“It is always advisable to start with insurance planning at a younger age, as there are more benefits, and lesser premiums, and youth can lead a sustained and financially protected life for a longer period of their lifetime,” Chaz said, while suggesting five insurance policies for the youth.
Term Life Insurance with Return of Premium Option: Term life insurance is an essential policy for the youth to ensure the financial well-being of their loved ones in case of an unfortunate event. By opting for a policy with the “Return of Premium” feature, policyholders can get back the total premiums paid if they outlive the policy’s term. This provision is an excellent investment for the future, offering protection and potential returns. Youth can be assured that their financial contributions will not go to waste, ensuring a sustainable path to safeguard their family’s financial stability.
Health Insurance with Personal Accident Cover: Health is wealth, and investing in comprehensive health insurance is crucial to leading a sustainable life. With medical expenses soaring high, adequate health coverage protects youth from potential financial setbacks from unexpected illnesses or accidents. For example, with the rising accident cases amongst today’s youth, a personal accident cover (in-built into the health insurance plan) provides an additional lump sum pay-out in case of an accident, and the health insurance policy covers hospitalisation expenses.
Zero Depreciation Add-on Cover in Car Insurance: As the youth increasingly embraces eco-consciousness, owning a vehicle today is responsible for protecting the environment and oneself. Car insurance offers financial protection against accidents, theft, or damages caused to others due to their vehicle by insuring their cars. Along with car insurance, today’s youth should opt for add-on covers like Zero Depreciation, Roadside Assistance, Engine Protector, NCB Protection, Key Replacement, Loss of Personal Belongings and Return to Invoice.
Cyber Insurance: India reported around 53,000 cases of cybercrime in 2021 and the rate is increasing steadily at around 5 per cent yearly. Cyber insurance has become necessary in today’s technologically advanced world, especially for the tech-savvy youth. As they lead their lives online, there is an increasing risk of cyber threats such as phishing and email spoofing, identity theft, unauthorised online transactions, legal expenses, cyber extortion, etc. Cyber insurance offers protection against these risks and provides financial assistance in the event of cyber-related incidents. By investing in cyber insurance, the youth can safeguard their digital assets and financial security, embracing sustainability in the digital realm.
Travel Insurance: While travelling brings joy and personal growth, it also entails certain risks. Travel insurance is essential for young individuals to protect themselves from unforeseen emergencies during their journeys, such as hospitalisation resulting from accidental injury or sickness, baggage loss/theft, trip cancellation, flight delay/cancellation, passport loss/theft, etc. By investing in travel insurance, the youth can enjoy their explorations responsibly, ensuring financial security and supporting the principles of sustainable tourism.
Insurance provides a safety net that can help mitigate the financial impact of unexpected events. Chaz said people should not wait to buy insurance policies till they reach an elderly age. Today’s lifestyle is very different from the past and an unprecedented circumstance or event can happen in anyone’s life, sans the age. While this Youth Day celebrates a sustainable world, Insurance will equally help create a sustainable financial world for themselves and their families.
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