Top 5 Reasons Young Indians Delay Health Insurance

Are you delaying buying health insurance because you're young, fit, and healthy? Many young Indians share this sentiment, believing insurance isn’t a priority at present. However, unexpected medical emergencies can happen to anyone, and having a good health plan early can save you a lot of trouble later.

Healthcare costs in India are rising rapidly. According to government statistics, medical inflation in India has been around 14% in recent years. Yet, many young Indians continue to postpone purchasing health insurance.

A survey commissioned by HDFC ERGO General Insurance and conducted by NielsenIQ gathered insights from 2,200 respondents across 17 Tier 1 and Tier 2 cities in India. The report emphasises that out of 167 Gen Z, 44% do not invest in health insurance due to lack of awareness, whereas 43% millennials out of 393 surveyed believe that their existing coverage under corporate health insurance is sufficient and hence, do not purchase personal health insurance. Let’s take a closer look at what's holding them back and how the right health coverage can help.

1. Lack of Awareness Among Gen Z
The survey revealed that out of 167 Gen Z individuals surveyed, about 44% delay buying health insurance because they don’t know enough about its benefits and options. Many don’t fully understand how health insurance works or how easy it is to buy online. As a result, they often wait until a medical emergency happens, missing the chance to get protected early.

By providing clear information and easy-to-use online tools, insurers can help young people better understand health insurance and get covered sooner.

2. Reliance on Corporate Health Cover
Many millennials rely only on the health insurance provided by their employers. In fact, out of 393 respondents, 43% stated that they believe staying covered under a group plan is sufficient.

However, this can be risky, as corporate health plans often have limited coverage and end when you leave the job. This means you might be left without protection during job changes or career breaks. Having your own health insurance ensures you stay covered, no matter where you work.

3. Over-Reliance on Family and Agents
Gen Z and millennials continue to rely on family and agents when selecting and purchasing the right coverage. This is because:

• Family influence remains strong for Gen Z, with about 57% of the 167 respondents saying they rely on family members and friends for advice when selecting a health insurance plan.

For example, a young adult chooses the same insurer or plan their parents had for years, thinking it must be good. They may overlook newer plans that offer better coverage, lower premiums, or benefits more suited to their current needs.

Some people depend on their parents’ employer-provided insurance, unaware that it might not be sufficient or could be discontinued at any time.

Despite being tech-savvy, many Gen Z still prefer buying insurance offline. 67% Gen Z among 840 respondents require assistance and support, leading to a significantly higher preference in purchasing policies through offline channels.

4. Affordability Misconceptions
A major reason young Indians delay buying health insurance is that they believe it is not affordable. The survey also highlighted a growing demand for flexible payment options:

• Out of 300 respondents, approximately 30% in Hyderabad and 29% in Mumbai said that they are actively seeking staggered payment options, such as monthly or quarterly premiums. This indicates a growing demand for more manageable and budget-friendly health insurance plans.

• While many young buyers look for flexible premium payment options, the good news is that several insurers already offer them, making health insurance more accessible than it may seem.

5. Lack of Clarity on Wellness Benefits
Among 1,400 respondents, only about 36% of young Indians said that wellness benefits influence their decision to buy health insurance. This shows many are not clear about what these benefits include or how they can help.

Wellness benefits, such as free health check-ups, discounts on gym memberships and rewards for healthy habits, could encourage youngsters to buy health insurance sooner.