Insurance Premia Slashed: GST Exemption Brings Relief

The GST Council has exempted life and health insurance premiums from the Goods and Services Tax, promising reduced costs and broader coverage. Starting September 22, all individual insurance policies and reinsurance will benefit from this tax break, aimed at making insurance more affordable for the public.

The 56th GST Council meeting, led by Finance Minister Nirmala Sitharaman, has announced a significant exemption from the Goods and Services Tax (GST) for life and health insurance policies. This move is set to reduce insurance premiums and facilitate wider coverage across the nation.

As of September 22, premiums for individual life insurance policies, including term life, ULIP, and endowment, along with reinsurance, will no longer be subject to GST. Similarly, all individual health insurance schemes, including family floater and senior citizen policies, will enjoy the same tax break.

The abolition of the 18% GST on insurance premiums marks a significant shift since its inception in July 2017. With the government committed to ensuring the benefits are fully transferred to consumers, this initiative aims to make insurance more accessible and affordable for the public, boosting coverage nationwide.

(With inputs from agencies.)