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Today Indi’s driver shared a story of his friend who was hospitalized since last week. The friend, who’s around 40-year old, had passed away after one week in the hospital. I wasn’t really clear on the cause of the death, but it’s something related to coughing, lung, and some clogging in the blood circulation. Indi’s driver was shocked because the friend has been quite in a healthy state, rarely falling sick. A few weeks back, he fell sick with something that wasn’t seemed very serious, some coughing. Then he visited a medicine-man, and also bought some over-the-kiosk medicine. Then his condition became worse, and hospitalization couldn’t be avoided. He should’ve been operated, but the operation plan was delayed because he didn’t have enough money.
He worked as construction worker, earning net Rp 40,000 per day (around 3.5 USD). Per months he should earn around 960,000 – 1 million rupiah (around 100 USD per month). He has two small children; the youngest one is about 4 year old. His wife works from home as a laundress and an ironing lady while taking care of the small children. Previously, they earned just enough to get by. Now I can’t imagine the burden that fell under her shoulder, paying the hospital bills and her future livelihood, now that her husband had passed away.
Curious about the cause of death, which seemed to be linked with lung and respiration, I asked, “Does he smoke?” Indi’s driver said yes. Aside to the possibility of the illness being linked to his smoking, I also began calculating. Say, on the low side, he smokes 1 pack per day for 30 days per month. The cheapest brand is about Rp 6,000 per pack. That means per month he spends Rp 180,000 which is about 20% of his monthly income. That percentage number sounds too high for me. On the high side, he could smoke more than 1 pack, which means that the cigarette expenses could shoot up to 40-50 % of his income.
If only he had put aside a fraction of his cigarette expenses to pay for a very basic health insurance and life insurance, his wife might not need to worry so much when unexpected death happens. From what I read somewhere, AskesKin can be secured with a payment of around Rp 5,000-10,000 per month, giving very basic health insurance coverage. I don’t have the data, but I’m sure there should be some sort of life insurance policy that should be affordable for construction worker salary bracket. Maybe Rp 40,000 per month (Rp 480,000 per year) for 15-year basic term life insurance policy, probably can get him Rp 10 million coverage, enough until his kids are grown to be more independent… I dunno. But anyway, this brings a total Rp 50,000 per month for basic coverage, only a fraction of his cigarette budget. And if he quits smoking altogether, he could put the extra Rp 130,000 per month in savings.
I was trying to communicate these numbers with the driver, but he doesn’t seem to get it. He doesn’t understand that there is an opportunity cost of smoking and that saving/insurance could be important.
Is there a financial planning education for the poor and for the laborers (maids, drivers, construction workers)? Perhaps Ligwina Hananto would like to do this as a Corporate Social Responsibility exercise?