Why Aren’t Millennials Keen About Insurance?

Millennials are one of the generations who have a comfortable life in many aspects compared to the other previous generations. There’s the technology and the internet to complete most of the tasks. They have fallen behind in terms of risk coverage since they have less time to think about this subject.

Insurance is necessary for everyone irrespective of their age, gender, and social status. When it comes to millennials, the percentage of people under coverage is very low. This is not because they cannot afford it. This may be due to the common notion that insurance is only required in old age, and it is too early for them to invest in insurance.

However, there is a positive correlation between insurance premiums and age. The sooner you get an insurance policy, the lower will be your premiums. Also, it is best to get a policy when you are healthy. 

The insurance premiums may also consider factors, such as financial well-being, social security, number of dependents, number of working people in the household, and others. 

Reasons for millennials not buying insurance
 

1. Too soon for insurance

Millennials don’t have it like the olden days where you take a big family’s responsibilities, and you are the sole breadwinner. Things are much more simple and easy now. Millennials think that there’s still so much time in life where they reach a point where they need insurance. As said earlier, the sooner you start, the lower is the cost. The later you start, you pay a higher price for the same policy features.

2. That’s just an additional expense

Millennials consider insurance a mere expense that’s unnecessary rather than looking at it in a positive light. They wouldn’t prefer having insurance premiums in their monthly budget. In reality, it could be a lot more of a help than millennials can think of.

The way out

All millennials have to do is take out some time to understand the types of insurance, cost of insurance, and how it can help them and their dependents. Millennials are a generation that’s very sharp and smart. Once they spare some time understanding insurance, they will realise the importance of insurance and purchase a suitable policy.

As an attempt, here is a little brief on the type of life insurance:

Term insurance

The term insurance provides monetary relief to the family in the case of the policyholder’s untimely death. The insurance offers a high insured sum at low premiums. On the other hand, if you survive the coverage period, no benefit is provided.

Unit linked insurance plan (ULIP)

ULIPs are a combination of insurance and investment options where the individual directly handles the risk. You can get returns on investment made, get life cover, and tax benefits on the money invested in this product. This type is ideal for those who are looking to stay invested for a long-time.

Endowment plan

If you are not ready to take any risks on your investment, you can go for endowment plans or those that offer guaranteed returns. These plans will be designed with an end goal of marriage, children’s education, and others. In case the policyholder passes away during the coverage period, the remaining premiums will be waived off, and the sum assured will be paid to the nominee.

Millennials have their sources to research further on these plans. Once they do, there are possibilities that their prejudice vanishes and they develop an interest in insurance.