Lifestyle Insurance: Why Young Adults Need It?

Some things improve life, whether it be a cup of coffee, an annual vacation, or a new outfit. Everyone wants to enhance their lifestyle as it means a better quality of life.

However, even though the roaring twenties are a decade for travel and joyful exploration for young adults, they are also a period of growing responsibility. Young adults may want to get married, start a family or need to provide for ageing parents.

Therefore, it is advisable to protect oneself against life's uncertainties by investing in a lifestyle insurance policy. This investment will ensure that one can maintain their current standard of living without worrying about exorbitant medical expenses in the future resulting from unforeseen circumstances.

What precisely is a life insurance policy, then?

Where can one find it, and how can one obtain it?

Are you now asking how you can protect yourself financially if something unfortunate happens??

What is lifestyle insurance?

Lifestyle insurance protects a person's possessions and lifestyle by ensuring that unanticipated events like serious illnesses or accidents cause minimum financial loss and inconvenience.

It covers your finances and allows you to continue living at your current standard even if you're faced with illnesses, accidents or disabilities for a predetermined premium.

What does lifestyle insurance cover?

Lifestyle insurance protects a person against any or all of the following incidents:

Sickness

A mental or physical illness for which the insured person is receiving medical care from a doctor or therapist prohibits them from performing their regular job or any other task achievable with their expertise, education, or training. This includes medical and life insurance coverage.

Accident

A physical injury for which the insured person receives ongoing medical attention from a doctor or consultant keeps them from performing their regular job—or any other task they can reasonably accomplish, considering their skills, education, and training.

Total and Permanent Disability (TPD)

A physical injury renders the insured individual permanently incapacitated due to a sickness or accident and prevents them from working in any capacity in any occupation based on their prior training, education, or experience.

Unemployment (payor)

A situation where the insured person is totally without paid work and has registered himself as unemployed and can establish that they are proactively looking for employment.

Why is lifestyle insurance important?

Here are a few essential reasons young adults need to consider purchasing lifestyle insurance.

Financial uncertainty due to automated processes

While automation promises to boost the economy, it also jeopardises many existing professions. Automation, artificial intelligence, and robots are progressively undertaking complex jobs like disease diagnosis, language translation, content creation, etc., posing significant risks to work availability.

Given this, it's better to be financially prepared for the worst-case scenario. The good news is that lifestyle insurance policies are tailored precisely to protect one against such occurrences.

Broader coverage at a lower cost

Lifestyle insurance offers more comprehensive coverage at lower premiums. This is because long-term coverage is involved, and the policyholder is younger and healthier. Many policies include a cutoff age beyond which one may not be eligible for coverage, so getting a lifestyle insurance policy early in life is better.

Comprehensive accident coverage.

Life doesn't always go as expected; mishaps can occur to anyone at any moment. Therefore, it's worth investing in lifestyle insurance coverage with lump sum disability/death payment and reimbursement of hospital bills to deal with the impact of an accident, disability or death.

Coverage for serious diseases.

It is wise to protect one's income and way of life with lifestyle insurance since critical illness may occur regardless of age or habits. The advantage of lifestyle coverage is that, in the event of a critical illness, a lump sum payment is delivered straight to the policyholder, enabling them to continue living their prior lifestyle without any hassles.

Life coverage

More important than life is ensuring your loved ones are protected in case of unforeseen circumstances resulting in the insured's demise. Lifestyle insurance helps surviving family members cope with the loss by preventing them from having to suffer financially or alter their lifestyle through the provision of a lump sum payout. This is especially important if you have a young family who still needs you as a breadwinner.

Increasing medical expenses.

Millennials and Gen Z may believe they have plenty of time to prepare and save for future healthcare and medical needs. However, due to medical inflation, healthcare expenses are soaring.

Therefore, a lifestyle insurance policy helps one prepare to face hefty medical expenditures in case of a sickness that necessitates hospitalisation or medical care. Moreover, it is an excellent strategy for dealing with rising healthcare prices.

Setting aside money for a property.

You’ll need to spend a sizeable amount of hard-earned money to buy your home. Setting realistic savings and investment goals at the beginning of each year is one method.

As an alternative, designate the whole annual bonus as savings by investing in lifestyle insurance. You'll be grateful that you planned for the future.

Saving up for travel

Vacations are expensive, so having some savings through a lifestyle insurance policy can be helpful whether one is planning a fun-filled trip for the near future or an overseas dream vacation.

In addition, this investment offers travellers financial security and peace of mind against risks associated with travel, including those brought on by unforeseen problems both before and during the journey.

Getting a head start on retirement savings.

You may think that retirement is still many years away, given that you are still in your 20s or early 30s. However, one will ultimately need to begin planning for it.

Ensuring financial independence after retirement will provide better peace of mind, whether one prefers an active and adventurous life as one gets older or a peaceful one spending time with their grandkids. Saving for retirement also makes more sense when one is younger and has fewer financial obligations, such as a mortgage or a child's schooling.

The earlier one begins by investing in lifestyle insurance; the more equipped one will be for life's unforeseen events.

Who should get lifestyle insurance?

The millennials and Gen Z young adults are the ones who need to invest in a lifestyle insurance policy. Millennials are those born between 1980 and 1995, and Gen Z are people born between 1996 and the early-mid 2000s.

The way of life for these Gen Z and millennial young adults is entirely different from the previous generations. They are more adventurous and ambitious; thus, lifestyle protection is necessary.

Where to get lifestyle insurance?

Given the wide variety of insurance carriers, choosing the right option may seem complex. However, picking a trustworthy insurance provider with a solid reputation is always wise.

Prudential’s PRUFirst lifestyle insurance is specially designed for young adults. It covers medical, accidental, life/total permanent disability and payor benefits, which are essential should anything unfortunate happen. PRUFirst ensures that you can continue enjoying your current lifestyle without financial worry.

How much is lifestyle insurance?

Prudential’s PRUFirst lifestyle insurance starts from RM135 per month. You can choose to boost your policy for more comprehensive coverage. However, remember that premiums are based on factors such as age, lifestyle habits and even payment method. Thus, it’s best to speak with the insurance company or agent for an accurate quote

Conclusion

Insurance does not pertain to older people only. Young adults should also invest in a lifestyle insurance plan since it is just as important as the other necessities in life. It is wise to start your insurance planning now if you're a millennial or a member of generation Z to protect your lifestyle and your loved ones too.