GST Exemption on Insurance Premiums: A Game-Changer for Health and Life Coverage
The GST Council's landmark decision to exempt insurance premiums from the indirect tax is hailed by industry leaders as a significant move towards making insurance products more affordable. This reform is expected to increase insurance penetration, benefit policyholders, and foster a more financially secure environment amid rising healthcare costs.
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- India
In a landmark decision, the GST Council has exempted insurance premiums from indirect taxes, a move praised by insurers for making policies more affordable and widening insurance reach. The announcement came at the 56th GST Council meeting led by Finance Minister Nirmala Sitharaman.
All life insurance policies, including term, ULIP, and endowment, as well as health insurance policies like family floaters and senior citizen plans, now fall under the GST exemption. This decision, in place since July 2017, removes the 18% GST on insurance premiums, heralding new affordability for consumers.
Industry leaders, including LIC CEO R Doraiswamy and Hinduja Group Chairman Ashok P Hinduja, hailed the reform as revolutionary. They emphasized its role in easing financial burdens amid rising medical inflation and accelerating insurance penetration. The exemption is deemed a forward-looking reform to promote a healthier and more financially secure India.
(With inputs from agencies.)
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