6 On Your Side Answers: Why are young people underinsured?

KNOXVILLE (WATE) – Young people between the ages of 18 and 29, called millennials, are by and large underinsured. They’re the least likely of every age group to have all types of life insurance.

Susan from Madisonville writes: “My 25-year-old son told me the other day he doesn’t need health insurance. What’s up with young adults?”

Millennials apparently have an aversion toward insurance.

Nearly one in four millennials, 24 percent, lack health insurance, according to a new survey from Princeton Research Associates.

A lot has been made of the young invincibles, those between the ages of 18 and 29, who choose to forgo health insurance despite the Affordable Care Act’s mandate that all Americans have health insurance.

Young people typically pay much lower prices to obtain coverage, by way of the health care exchanges, and they can receive subsidies depending on their income.

Plus, they can stay on their parents health insurance policies until the age of 26.

Among those who rent apartments or homes, the report found that only 12 percent of millennials have renter’s insurance, despite the fact that this coverage can be very inexpensive, around $10 a month in many cases.

Even car insurance, mandatory in all states except for New Hampshire, is not particularly popular among millennials. Thirty-six percent of 18- to 29-year-olds do not have auto insurance.

When it comes to life insurance, 64 percent of millennials do not have coverage. The most common explanation was that it cost too much.

Yet, the cost for half a million dollars worth of 20 year term life insurance is less than $20 a month for a young adult.

Despite all this evidence that millennials do not have a lot of insurance, 60 percent of 18- to 29-year-olds are either very confident or somewhat confident that they are prepared for the financial consequences of car accidents, having their belongings stolen, or incurring substantial medical bills.

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