Why health insurance is critical in retirement

Muneesh Sharma retired from his corporate job last year, at 65. He had a decent amount saved in deposits, bonds and shares for a comfortable life. However, since he had no mediclaim, his finances took a hit when he had to pay a Rs.10 lakh hospital bill for an unplanned angioplasty last month. His corporate health cover ended with his retirement and, though he believed he had saved enough, the unexpected expense left him stretched. Now, his friends are advising him to purchase health insurance, but he wonders if it’s possible at his age and if the cost would be worth it.

Muneesh Sharma needs to recognise that with increasing age, healthcare expenses rise, while regular income decreases after retirement. As healthcare costs are escalating rapidly, Sharma should ensure he can afford quality care, medicines and tests. Having health insurance will provide him peace of mind, knowing that medical expenses will be taken care of.

Sharma should opt for health plans tailored for senior citizens. Such schemes are more expensive due to the higher frequency and severity of illness in older age. Senior citizen plans come with limitations like mandatory medical check-ups, high premiums, and various exclusions. Therefore, Sharma should thoroughly research key factors, such as entry and exit age, hospital networks, coverage, exclusions, co-pay limits, waiting periods, and critical illness cover. Even partial coverage will be better than none.


It’s important for him to shop around and find a policy that fits his health condition and needs. Given his recent angioplasty, insurers might view him as falling in the higher risk category, making it crucial to act before costs rise further. Ultimately, paying an annual premium for health insurance might be a better option than liquidating investments for medical bills.

Content courtesy Centre for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.