[Insurance Tips] ⑪ Safety Net for an Aging Society... Age-Appropriate Insurance Products

[Asia Economy Reporter Changhwan Lee] South Korea entered an aged society in 2018, with the population aged 65 and over exceeding 14%, and it is expected to enter a super-aged society with over 20% of the population aged 65 and above within 3 to 4 years.

While society is aging rapidly, South Korea's elderly poverty rate is at a world-leading level of 44%, and medical expenses that must be borne in old age are also increasing. Because the country entered the aged society too quickly, many people have not properly prepared for their old age.

Entering a super-aged society without adequate old-age preparation may not be a blessing. This is why the role of insurance for old-age preparation is even more important.

Insurance products serve as a minimum safety net to prepare for a secure old age, so even young people should take an interest. For a healthy and happy old age in the era of longevity, it is necessary to choose insurance that fits each life cycle. We looked into insurance products suitable for different age groups.

◆Children's Insurance Offers the Best Cost-Effectiveness for Those Under 30

During infancy and childhood, including the fetal stage, insurance is needed to prepare for diseases and various injury risks such as fractures and burns that are likely to occur by age. This can be covered by children's insurance.

The fetal rider, which can be subscribed to as a special rider in children's insurance, is an insurance product that covers disabilities and diseases such as low birth weight (prematurity) and congenital anomalies (birth defects) that may occur to the fetus.

Additionally, children's insurance focuses on covering diseases, fractures, burns, and other risks that are common in children. Recently sold children's insurance policies can be continued after reaching adulthood and have the advantage of covering adult diseases such as cancer at relatively affordable premiums, making them increasingly popular.

◆Cancer Insurance, Pension Savings Insurance, and Whole Life Insurance for Those in Their 20s to 40s

People in their 20s to 40s, who are actively engaged in social activities, are at a stage suitable for seeking economic independence and starting to prepare for disease coverage and old-age security.

Due to the nature of insurance, subscribing early allows for designing quality coverage at a lower premium, so it is better to subscribe sooner rather than later.

In youth, preparation for cancer, which has a high incidence and recurrence rate, is necessary. Recently, as survival rates have increased, it is also important to prepare for treatment and post-care costs.

Life insurance companies' cancer insurance mainly provides diagnosis fees upon cancer occurrence and, depending on the product, also covers hospitalization, surgery, radiation therapy, and other treatment costs related to cancer.

Subscribing to pension savings insurance for old-age funds is also recommended. Pension savings insurance is a savings insurance product where premiums are paid for more than five years, and pensions can be received after age 55. The yield is determined according to the announced interest rate. However, unlike general savings, a certain period of business expenses is deducted, so long-term payment is essential.

Whole life insurance covers the insured for the duration of their life, paying benefits to survivors after the insured's death.

Most whole life insurance policies include additional riders that provide coverage beyond death benefits, such as family living expenses support, and coverage for medical expenses related to diseases like cancer, cerebral hemorrhage, and long-term care (LTC), allowing for diverse protection within a single insurance product.

◆Dementia Insurance and Old-Age Security Insurance for Those Aged 50 and Above

Around the age of 50, preparation for dementia is also necessary. Dementia and long-term care insurance covers various costs arising from dementia, including medical and nursing care expenses.

Recently, coverage has expanded not only to severe dementia but also to mild dementia, and the coverage period has been extended from age 80 to 100 or even lifelong, providing practical assistance to insurance consumers.

If sufficient preparation for medical expenses is not made for those aged 60 and above, it can threaten not only the individual but also the economic stability of their family. Therefore, it is necessary to reduce the burden of old-age medical expenses through old-age security insurance.

Old-age security insurance includes health insurance, cancer insurance, silver insurance, and long-term care (LTC) insurance. These cover diagnosis fees and treatment costs such as hospitalization and surgery due to various diseases and injuries.