'Health insurance is the difference between being well off and poverty…’: Expert explains why

Despite the rapid pace of digital transformation that India has seen in the recent past, a large number of people are still hesitant when it comes to buying a health insurance policy. 

Insurance advisor Nikhil Jha Tuesday took to X to share a recent customer experience to reveal how having a health insurance policy can be a game-changer in financial decisions. He said he was approached last year by a follower for a policy for his 74-year-old father. 

Policy premiums for senior citizens tend to be on the higher end due to factors such as more chances of disease diagnosis and old age. Hence, the man's premium alone was nearly Rs 1.5 lakh per year for a policy coverage of Rs 10 lakh. "After much back and forth I made him buy the policy. A couple of days back, the father had an accident and fell down the stairs. He has now been diagnosed with brain hemorrhage," Jha's post read. 

"The father was admitted to the hospital and we made sure there was instant approval. Now, the father is undergoing treatment and we hope he recovers soon. But the follower was glad we made him buy the health insurance policy and now Rs 5-7 lakh hospital bill will be covered by the insurer," it further read. 

Jha ended his post saying, "Always have a health insurance policy. It is the difference b/w being well off and poverty!"

After a brief surge during the Covid years, India's insurance penetration has dropped again. "Despite the Insurance Regulatory and Development Authority of India's target of “Insurance for All” by 2047, the industry’s penetration rate slipped from 4.2 per cent in 2022 to 4 per cent in 2023, indicating that its progress has not been on par with the country’s economic growth," a recent McKinsey report from November last year stated.