I’m 26, just started my first job, and to be honest, insurance feels like something far away. But I hear experts saying to start early since it will be cheaper. I don’t have dependents yet, but I also don’t want to regret missing out on low premiums at my age. How do I decide how much life cover I actually need right now, without overcommitting when my salary is still modest?
— Name withheld on request
It’s wise to consider life insurance early. Buying a term plan in your 20s locks in very low premiums for long durations. For example, a healthy 26-year-old non-smoker could secure a ₹1 crore cover for around ₹7,000–10,000 annually, often less than the cost of a daily coffee.
Since you don’t yet have dependents, you don’t need to overcommit. Starting with a ₹50 lakh– ₹1 crore cover is practical. This ensures basic protection if responsibilities arise suddenly, for example, supporting family or taking on a loan.
How much cover you need depends on:
Income and lifestyle: A common rule is 10–15 times your annual income, though a need-based approach (factoring future expenses and liabilities) is more accurate.
Future responsibilities: Even if none exist today, you may have dependents in 5–10 years.
Liabilities: Any future commitments, like a home loan, should be factored in.
Term insurance is flexible, many plans allow cover enhancement later or let you add policies as life circumstances change. The key is to review your plan regularly when you hit milestones such as a higher salary, marriage, or home ownership.
The smart move is to begin with a modest, affordable plan now. Over time, you can scale up your coverage as income and responsibilities grow, enjoying the benefit of low entry premiums without stretching your current budget.
I’m 29, a woman working as a freelance graphic designer from home. Since I don’t have the cushion of corporate health benefits, I’ve been worrying about unexpected medical bills. On top of that, I’ve recently started therapy sessions for anxiety, which are not cheap. I want to know, are there health insurance policies that cover both regular medical needs and mental health therapy, including online consultations?
— Name withheld on request
As a freelancer without employer-provided benefits, an individual health insurance policy is the most effective way to protect yourself from unforeseen medical costs. At your age, a comprehensive cover of around ₹10 lakh is a sensible starting point, costing approximately ₹10,000–15,000 annually depending on the insurer.
Mental health is now receiving more attention, especially after the Mental Healthcare Act, 2017 mandated parity between mental and physical illness coverage. Most insurers now cover psychiatric hospitalisation, but outpatient therapy sessions, counselling, and online consultations remain limited. These usually fall under OPD (outpatient department) benefits, which are not part of standard plans. Some insurers offer OPD riders for an additional premium, but they often have low annual caps ( ₹5,000– ₹10,000), so while they won’t cover therapy fully, they can help reduce out-of-pocket costs.
A few digital-first insurers are experimenting with broader OPD and wellness packages, including mental health, but these are still not mainstream. Points to watch
When selecting a policy:
- Disclose ongoing anxiety treatment upfront. It may be classified as a pre-existing condition with up to 3 years of waiting period. A doctor’s note certifying therapy as temporary may help.
- Look for OPD add-ons, wellness benefits, or teleconsultation support.
- Check insurer hospital networks and claim settlement ratios before finalizing.
In short, health insurance will protect you against major hospitalization costs, but therapy and OPD expenses may still require separate budgeting. A qualified advisor can help identify policies that balance affordability with relevant features.
(Manju Dhake is head – Insurance Advisory Practice at 1 Finance, a Sebi-registered investment advisory firm)
