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July 29th, 2016 by


Standing in a queue at Oliver Tambo Airport, my well-meaning neighbour decided to bend my ear about the loss her close friend suffered recently. A young man who used to go to school with her son passed away of cancer in a public hospital in Bellville. He had not applied for any type of essential insurance, in particular, Medical Aid, and as a result did not have access to the comfort and care of private health care.

“His parents had financial troubles you see,” my new friend hissed conspiratorially.

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insurance in your 20s

Medical aid for students and youth

This unfortunate story is neither far-fetched nor uncommon. It is a fact affirmed by many an actuary that medical aids are only considered once people get hitched and start their brood.

This becomes intensely problematic for medical aids to remain affordable because they rely on the young who do not often claim to subsidise the older generations, according to Ernst Marais CEO of ICON cancer network.

In essence, it is a vicious circle. The less young people who take out medical aid, the more expensive it becomes, making it even less likely for young people to apply for essential insurance.

What students and young professionals need know, is that medical aid is also helpful for purely selfish reasons and not only for the greater good.

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Nicky Smart* understood this well when she fell pregnant without medical aid. Unplanned pregnancies are also neither far-fetched nor uncommon and tend to occur more frequently in those young ‘irresponsible’ years.

While the antenatal care was adequate, her little boy Kade* was born with an open gut, and the public hospital was not equipped to help her. This resulted in an emergency airlift to the Red Cross Children’s hospital when time was running out. Fortunately, both Nicky and Kade pulled through the ordeal, but Nicky admits that the situation was ‘far from ideal’.

Medical aids, of course, do not work the same way as life insurance, where youth counts in your favour in terms of your premiums, but as you may require less hospitalisation and doctor’s visits it makes sense to opt for an entry level plan (you can easily upgrade later).

Change your life today! Compare Medical Aid plans here

Income protection for professionals

When we are young, we are also pretty invincible, or so we think. According to Arrive Alive, in single vehicle accidents, which account for 25 per cent of motorcycle accidents, rider error and reckless driving was present as the cause in 66 per cent of cases.

So with the recovery period needed after an accident in mind, it is just as cavalier to neglect taking out income protection.

To protect your future today with Income Protection, click here.

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Santam, South Africa’s largest insurer, explains income protection as ‘providing certainty of income in the event that you are unable to work owing to illness or accidents’.

Read more about what income protection entails here.

Life insurance for carefree living

One of the biggest benefits of taking out life insurance when you are young is that premiums are independently risk-rated.  This means that your premium will be cheapest when you are young and niggle-free.

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Peter Dempsey, CEO of the Association of Savings and Investments of South Africa, explains that during tough economic times, people tend to cancel their life insurance policies.

“A real pity,” he says, as your premiums will most likely be higher when you apply later on in life and you could face more exclusions which equates to a type of loss.

Easily compare life insurance products here

‘It will not happen to me’

These are the ultimate famous last words. When all’s said and done, insurance is not just about protecting your Polo from an expensive accident – it can be a lifeline in times of stress, dread disease or income loss.

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*names have been changed.