Archive · 16 Aug 2025
Insurers Hope for GST Cuts on Health and Life Insurance
Insurance companies want the government to lower the tax (GST) on health and life insurance.
Currently, the tax is 18%.
They hope it will go down to 12%, like other goods and services.
This could make insurance cheaper, helping more people buy it.
The government is considering changes to tax rules, potentially shifting taxes from high to lower rates.
Lowering taxes could leave consumers with more money and increase insurance coverage.
Insurers are hopeful for a GST reduction on health and life insurance premiums.
Currently, the GST on these premiums is 18%.
Industry seeks a reduction to 12% and input tax credit.
A GST overhaul is proposed, potentially shifting items from 12% and 28% slabs.
Reduced GST could boost insurance affordability and aid insurance penetration.
- Who
- Life and non-life insurance industries.
- What
- Insurers are seeking a reduction in the GST on health and life insurance premiums.
- When
- Discussions follow a recent speech by the Prime Minister.
- Where
- The insurance market in India.
- Why
- To make insurance more affordable and increase insurance penetration.
Impact on Affordability
Future Outlook
GST Rates
Impact on Affordability
High GST makes insurance unaffordable, hindering growth.
Future Outlook
Lower GST will increase affordability and expand coverage.
- Current GST on Premiums
- 18%
- Industry Request
- GST reduction to 12%
- FY24 Insurance Penetration
- 3.7%
- FY20 GST Revenue
- Rs 2,101 crore
- FY24 GST Revenue
- Rs 16,398 crore
