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Retirement should be a period of financial well-being and complete peace of mind. However, with rising medical expenses, which are even higher than the general price level, many citizens find themselves financially unstable and insecure.
Looking for the right solution? Well, merging annuity income with senior citizen health insurance plans can help alleviate the impact of medical inflation and offer financial stability. Such a combination will provide you with complete financial freedom to beat rising medical inflation.
Key Takeaways
Healthcare costs in India are rising 12–15% annually, far above general inflation, quickly depleting retirement savings without proper planning.
Combining annuity income and health coverage ensures a stress-free retirement.
Merging annuity income and health insurance offers dual benefit, i.e., protecting your physical as well as your mental health.
With the right approach and right planning, you can prevent asset liquidation during emergencies.
A balanced retirement plan combines health insurance and annuity income, covering medical emergencies and ensuring daily financial stability for peace of mind.
Planning To Retire? Prepare for Soaring Healthcare Expenses
As we grow older, we tend to need more frequent doctor visits, medical checkups, and regular medications. Unfortunately, medical inflation, i.e., the rising cost of health-related products, is increasing much faster than the cost of living.
According to the Ministry of Statistics and Economic Times, the medical inflation in India is currently between 12% and 15%, significantly higher than the general inflation rate, which stands at around 5% to 6%. However, there are several reasons why medical costs keep rising in India, such as:
Factors
Reasons
Costly medical technology
The latest technology, like newly advanced scans and robotic surgeries, has made healthcare services more expensive. This includes extensive training on how to use them efficiently and effectively, which adds to the overall cost of healthcare services.
Rise of Long-term diseases
Several diseases, such as diabetes, high blood pressure, asthma, and cancer, are becoming more frequent. This raises total medical expenditures.
Foreign Patients
There is an increasing scope for medical tourism in India. This increase in international patients drives up the demand for healthcare services, consequently leading to higher prices.
Lack of healthcare professionals
Many doctors and nurses migrate abroad in search of good opportunities. This shortage limits the quality of healthcare services and raises their prices.
Quality Healthcare
People prefer modern treatments and top specialists, but there are not enough resources to serve the needs of everyone. This imbalance between demand and supply increases the prices.
It simply shows there is a high chance that medical or healthcare expenses could double in the upcoming years. In addition, this can be a critical problem for those people living on fixed and constant pension plans. As for them, the cost seems to be very high, from simple tests to hospital stays. The actual reason for such a difficult condition is that many people don’t plan for these significantly rising costs.
Medical inflation is not just about overspending; it’s about making a wise decision to beat it and make your healthcare services accessible.
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Understanding The Annuity Income
An annuity is a financial product offered by insurance companies that provides a steady stream of income in exchange for a lump-sum payment. It's an essential component of retirement planning, especially for ensuring a dependable pension plan in India.
For instance, Canara HSBC Life Insurance offers annuity options that provide flexibility and lifelong income and allow you to include your spouse for continued benefits. Here is the overview:
Depending on your needs, this plan gives you different ways to receive your pension.
Immediate annuity plans
This plan offers a regular income stream after your lump sum payment.
Deferred annuity plans
It is an ideal option for those still working and wanting to accumulate a good amount of money.
Smart guaranteed pension
This plan offers fixed and guaranteed pension income. You can also choose how long you want to pay the premium.
Guaranteed income4life
This plan offers you guaranteed income for a fixed number of years or your entire life. It is great for people looking for a stable and predictable income in retirement.
It is considered one of the good pension plans in India. It offers two options: a single-life annuity and a joint-life annuity.
Why Senior Citizens Must Have Health Insurance in India?
Senior citizens need health insurance more than ever for various reasons. As age increases, medical expenses also increase. Earlier, it used to be a minor allocation from a monthly expenditure, but now it has become a key issue. From doctor consultations to chronic treatments, the prices of all have skyrocketed.
What’s the solution for this? If you think of health insurance, you are right. Health insurance coverage helps meet unexpected medical emergencies or protects you from high out-of-pocket expenses. It safeguards and ensures your health and financial security remain intact. This is exactly why health insurance is a non-negotiable component of retirement planning, especially for senior citizens in India. Here are some of the reasons to explore:
Better Access to Trusted Hospitals and Doctors - One of the biggest advantages for policyholders is the assurance of quality healthcare. With access to a wide network of top-tier hospitals and highly qualified medical professionals, they can receive the best treatment without any compromise on care or facilities. This coverage ensures that you don't have to compromise with your healthcare facilities.
Increased Risk of Chronic Diseases - As we discussed earlier, the chances of health problems increase with age. These problems may include high blood pressure, diabetes, heart problems, etc. These chronic problems often need frequent medical checkups and follow-ups. Only a good pension plan in India can help you control these rising expenses, which may quickly drain all your savings.
The Growing Burden of Medical Bills - We are all very well aware of the rising medical costs. The cost of surgeries, hospital stays, and even small checkups has been increasing every year. Your health insurance coverage may provide significant benefits in meeting these costs, but you need a strong and solid retirement fund to beat inflation. Interested in finding out more?
Did You Know?
Health insurance premiums in India typically increase by 10–15% every five years for individuals aged 60 and above.
To secure your retirement planning, you need a perfect combination of annuity income and senior citizen health insurance. While planning for retirement, you must consider both, as one helps you meet everyday needs, and the other keeps you safe from unexpected medical costs.
Here is the overview:
Benefit
Annuity
Health Insurance
Medical emergency
Avoids the sinking of your long-term investments.
Pays for hospitalisation and medical surgeries
Monthly Living
Regular and steady flow of income for daily expenses
No pressure to save every rupee from the savings
Financially independent
No dependency on children
Protects you from unexpected medical expenses
Peace of mind
Sense of comfort from a reliable source of income
Access to quality medical treatment
Therefore, combining annuity income with senior citizen health insurance can build substantial wealth and a corpus for your retirement. Canara HSBC Life Insurance offers a diverse range of reliable pension plans in India that are thoughtfully tailored to suit the unique needs of retirees in India.
We also offer senior citizen health insurance plans that cover serious health problems, cashless hospitalisation, and many other quality services. These approaches can significantly reduce rising medical inflation and allow you to live your retirement life with complete freedom and mental calm.
Conclusion
Relying only on your savings is an approach to building a corpus to help you during retirement. That’s why effective retirement planning focuses more on annuity plans and comprehensive health insurance policies. Such a good pension plan in India helps you make informed financial decisions for retirement. This method allows you to live with confidence and dignity, especially during retirement.
Glossary
Medical inflation: A significant rise in healthcare costs faster than regular prices, making treatments costlier yearly.
Chronic disease: Long-lasting or serious health problem, like diabetes or high blood pressure, that needs regular care and treatment.
Single-life annuity: This is a type of annuity option that provides regular income to one person until their death.
Joint life annuity: A plan that gives you a regular flow of income and continues for your spouse after you.
Robotic surgeries: Surgical procedures with high accuracy by robots. They are usually less painful and quicker to recover from.
FAQs
Yes, you can get tax benefits under Section 80CCC for the premiums paid on annuity plans. However, the income you receive from the annuity is taxable.
If your medical expenses exceed the coverage, you'll need to pay the remaining amount from your savings. That's why having health insurance and annuity income is a good idea.
It is best to start an annuity plan when you retire, usually between 55 and 60. Starting earlier gives you better options for a steady income during retirement.
A good health insurance plan for seniors in India usually costs between ₹20,000 and ₹35,000 per year. The cost depends on your age, health, and the coverage you choose.
Yes, health insurance premiums usually increase as you get older due to rising healthcare costs. The rate of increase depends on your insurer and policy terms.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
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