Getting sick can make everything in life so much more difficult, so the last thing that anyone needs is medical debt. In a world where 25% of adults aged 18 to 29 have student loan debt, young adults accruing additional debt from treating a critical illness could be detrimental.1 On top of the pain and difficulty, illnesses can be very expensive to treat, so critical illness insurance can provide additional financial protection that could help some prepare for an unexpected condition. Let’s explore some reasons why young people should consider critical illness insurance.
Rising rates of critical illness
Some sudden conditions that critical illness insurance may cover include heart attacks, organ failure, and strokes. While these conditions may be more common for older Americans than for younger Americans, younger people may be at a greater risk than before.
Since 2019, the rate of heart attacks among people aged 18 to 44 has increased over 66%.2 Likewise, the rate of strokes among young people in the same age group rose 14.6% when comparing two time spans, 2011 – 2013 and 2020 – 2022.3 So, while young people may be less likely to get critical illnesses than older people, the rising rates for some conditions may start to put more of them at risk. If younger generations want to financially protect themselves from unforeseen conditions, they might want to consider critical illness insurance.
How much does a critical illness cost?
Critical illnesses can be expensive to treat, even for young people who have primary health care coverage. On average, the direct costs of treating a stroke, for example, range between $30,000 and $120,000, because of hospitalization, tests, medications, and rehabilitation services.4 Primary health insurance coverage varies, but your health insurance may not cover all the expenses associated with each step of recovery from a critical illness. Critical illness insurance can help cover some of the costs that insurance won’t cover, perhaps giving some people an opportunity to stay afloat in the face of mounting medical debt.
How critical illness insurance can help young people
With mounting rates for some critical illnesses among young people and rising costs of living due to inflation, any degree of increased financial protection against medical crises could be a tremendous help. Critical illness insurance can give policyholders direct cash benefits, allowing them to use the cash in different ways, helping pay for any of the stages of treatment and recovery.
One may wonder, “Is critical illness insurance taxable?” The funds policyholders receive when their insurance pays out are flexible, and sometimes, critical illness insurance funds are non-taxable, depending on the locale and whether the policyholder paid the premiums with after-tax dollars. Increased flexibility and receiving untaxable funds could make critical illness insurance a crucial element in helping some young people pay for their treatment and recovery after a life-altering condition.
Critical illness insurance and preparing for the unexpected
As young people face more financial difficulty due to student debt and rising inflation, as well as an increased likelihood of contracting certain critical illnesses, they may want to consider critical illness insurance. Critical illness insurance may be one way for individuals to limit the financial difficulty that comes with treating serious conditions that they may not see coming.
Young people may not think that they’re at risk of contracting a life-altering disease or condition, but they, too, may experience a critical illness. Speaking with an insurance agent about their options to protect themselves against a disease that’s expensive to treat could be the first step in fortifying themselves from disastrous medical bills in the future.