India is not only running a huge risk of terrorism but we also run a high risk of remaining largely uninsured population country. In 2017, our per capita insurance premium was USD 59.7 as against the US’s USD 343.1 and the global average of USD 638.3.
We are less than 10% of the global average. We are the 2nd largest populated country in the world and we pay one-tenth of the global per capita life insurance premium.
Our life insurance penetration is only 2.72% and health insurance is only 0.77%. These are alarming figures.
We all are suffering from our short-term myopic thinking. The insurance premium is not offering any immediate benefits so we defer and mostly ignore. Government for our sake offers tax benefits for us to have an insurance policy.
Long-term investors create wealth in the stock market but most of the people trade and invest for short-term meagre gain. Regular exercise and proper diet is the sustainable way to remain healthy but people prefer short-term dangerous approaches. Companies focus on quarter to quarter to performance ignoring the long-term strategy.
Short-term pain is okay for the long-term sustainable benefits but it’s a challenge.
“The most damaging aspect of contemporary living is short-term thinking.” Rick Warren
Yes, its damaging and it could be miserable for your family. Here are some of the dangers of remaining uninsured.
1. Family is vulnerable
In the absence of a Life insurance policy, the family remains vulnerable. When the bread earner dies suddenly, imagine the plight of the family members who were dependent on the earning member.
This is more dreadful when the earning member dies young. He had his parents and small kids dependent on him.
If you know someone without a life insurance policy suggests him to have one. She could be your home maid, driver, security guard, peon, staff members and even your friends.
This could be a great favour for him.
Handpicked related post: What should be the first investment from your first salary
2. Spouse forced to work
A bread earner has died without a life insurance policy. The responsibility for the sustenance of the family falls on his spouse.
In spite of women, education is on the rise the data suggest in India only 28.5% of women work as compared to 82% men.
In the event of the death of an earning member woman who might not be skilled or trained is forced to work. She will have responsibilities of taking care of old parents of the husband, education of the young children, and earnings for the family.
A life insurance policy could give solace the spouse of the deceased. This could ease her burden to some extent.
If you are not insured, get a life insurance today. Your family will thank you for that.
3. Children education suffers
The spouse who is compelled to work in the event of the death of the earning member may not be able to earn sufficient enough to execute all the financial responsibilities single-handed.
Immediate casualty could be the education of the children. Either she won’t be able to afford the higher education or she may need the support of another family member to earn. Children had to give up the study and look out for the job. In both the scenario, their education suffers.
Handpicked related post: How having a life insurance policy for your minor child helps?
4. Big financial shock
This is a situation when the family is without a health insurance policy. A family member hospitalized is a big cost for any family. On one hand lifestyle diseases are rising and on the other hand, medical treatment cost is also on the increase. Therefore living without an adequate health insurance policy could be a huge financial risk.
With only 0.77% penetration, the large part of the Indian population is living without health insurance policy. The recent announcement of Governments’ health insurance plan for the uninsured is a welcome step. This movement should spread.
5. Non-affordability of better treatment
In the absence of a health insurance policy, affordability of a better treatment is hampered. This is also a risk. Your decisions are taken based on the financial resources you have rather than what is medically best in the interest of the patient.
In conclusion, not having a life insurance policy and health insurance policy is a huge risk. You take this risk knowingly or unknowingly. In either case, this could be costly. It not only impacts the financials of your family but there are social, emotional and permanent repercussions.
“You will make better decisions once you begin thinking long-term rather than short-term.” Adam Kirk Smith
Think long-term and act for the long term benefits TODAY. Get insured and guide others to get insured. This is your personal social responsibility.
You may like to read this interesting post: One thing you should know about ULIPs to increase your returns