Insurance Experts Call for Tax Benefits Boost in Budget 2025
Insurance experts are also calling for the Finance Minister Nirmala Sitharaman to give special priority to the life and health insurance sectors in the forthcoming Budget 2025. Suggestions include increasing the Section 80D deduction on health insurance premium, and exempting term insurance premium from taxes as a standalone tax benefit in order to further increase coverage and security for the citizens.
Anup Rau, MD & CEO, Future Generali India Insurance, said health insurance is essential with healthcare inflation estimated at 12-15%. He suggested linking the medical insurance deduction limit to inflation for automatic revisions and extending the benefits to the new tax regime to encourage wider adoption of health insurance policies.
ACKO Life Insurance, CEO; argued for specific tax deduction under the head on term insurance, noting that he will have to push the premium coverage cover more. Hemade a plea either toenhance the cover limit under 80C and/ or by specific limits solely applicable to terms so that increased penetration in life cover is noticed. He proposed the basic form of term coverage coverage as obligatory at the moment of formal employement to address dependency.
Premium hikes because of inflation have become a burden for senior citizens. ManipalCigna Health Insurance CFO Srikanth Kandikonda urged raising the Section 80D limits to Rs 50,000 for the general public and Rs 1 lakh for seniors to ease the financial strain.
Life insurers also look for tax abolition on annuity or pension income. Jude Gomes, MD and CEO of Ageas Federal Life Insurance argues that elimination of tax on annuity product will boost retirement planning. Further, increasing the Rs 50,000 tax exemption on NPS to pension plans offered by life insurers will help make retirement savings more attractive.
These proposals mirror the increasing call for timely alterations to the tax benefits of insurance and are imperative in addressing rising health and life insurance costs.
