With higher disposable incomes, the millennials get access to myriad opportunities much earlier in their lives
I still remember the instructions my mother had given to me as a young man who had just started to earn. She had asked me to save a portion of my salary as part of rainy day fund. I had religiously followed her words and always used to set aside a chunk of my salary, lest anything ever went wrong. During all those years, I banished the thought of planning for a trip or buying that expensive suit or watch just to keep these savings of mine intact.
The country today is brimming with a young population, non-conformist to the age old Indian adage of earning and saving up for roti, kapda and makaan. With higher disposable incomes, the millennials unlike the baby boomers, have access to myriad opportunities and investment options much earlier in their lives. This has also exposed them to a superior quality of life—one with better resources at easy disposals.
While the new age life style is indeed a celebratory state of being, it is not a utopian era and things may still go awry. An accident severely damaging your brand new car, hurting yourself during an adventurous trek, or getting hospitalised after contracting a local outbreak etc. are certain common situations that may bring one’s life to a standstill. Given the rising costs, a single such damage or incident may burn a deep hole in your pockets or even evaporate your hard earned savings.
One may deal with such unpleasant situations smoothly if there is an adequate insurance protection in place. Insurance is a financial tool that covers you against all the risks that your life, health and assets may face, the importance of which is largely overlooked by most of the millennials. Though there is a negative sentiment for insurance in the minds of many, the industry’s combined ratio of 120 per cent in the last fiscal is a pure indication of it living up to its promise of paying out claims.
While a lot of online and offline research goes into buying of assets such as a vehicle or a property, the millennials at large are oblivious to putting in similar efforts while buying an insurance policy. For instance, a group medical cover is deemed adequate as against a standalone comprehensive health cover.
The healthcare costs have also risen exponentially and the contemporary sedentary lifestyle is manifesting a host of non communicable diseases at very early life stages. Apart from the threats to one’s health there are other risks too that can create a financial turmoil in a person’s life. The rising incidents of road accidents, frequent catastrophes such as floods and earthquakes etc., all have the potential to damage our most prized possessions and disturb our financial stability.
With high investments and heavy EMIs to procure and maintain these assets, suitable insurance policies are a must to safeguard one’s exposure to possible financial losses. Even more so when these insurance policies cost you no more than decent dinner dates. It is also advisable to buy insurance at the start of one’s career itself as not only would it ensure lower premium rates, but will also create a better relationship with your insurer.
Youngsters also need to be cognizant towards the fact that insurance policies these days offer much more than covering just claims. Insurers today provide a host of value-added services enabling a preventive environment rather than a curative one. With the advent of connected devices and Internet of Things (IoT), wellness and health tracking services in health insurance are gaining ground. Insurers are increasingly adopting the data analytics tools such as Fitbits and linking it to their insurance apps to identify current and future health risks in their customers. Based on this data, they are even suggesting lifestyle solutions to maintain good health amongst their customers. Similarly, telematics based motor policies have been launched where one gets to know his/her driving behaviour, engine and car health and can also avail renewal discounts based on one’s good driving behaviour.
To further create an appeal to the Generation Y, insurers have jumped on to the digitisation bandwagon and are re-defining the entire insurance experience. In their obsession towards creating a camaraderie with their new age customers, the insurers have leveraged latest technologies and are also available 24X7 on various social media platforms for easy claims and grievance redressal.
I realised the efficacy of transferring my risks to an insurance policy post joining the insurance industry. Instead of saving up considerable amounts for the potent bad times, I could have just spared an insignificant percentage of it to brace myself for the future. In a constant bid to live an action packed life, it is therefore of utmost importance that you make concerted efforts in creating an adequate safety net for yourself. An all-inclusive insurance portfolio shall hence help fulfil your dreams to live young, wild and carefree.
Tapan Singhel
MD&CEO, Bajaj Allianz General Insurance