Insurance

What are the main things you should know about GST on the insurance premium?

It is the responsibility of the head member of the family to safeguard the future of the family in terms of a medical emergency. A person worried about paying medical bills during hospitalization is not able to focus on the health of the patient. To save yourself from financial burden during a medical emergency you need to have a today suitable health care policy for all the members of a family. You need to pay a premium every month if you buy a healthcare policy. These days you have to pay Goods and Services Tax on the premium of healthcare policy. There is a hike in the gst rate on insurance premium of policy nowadays. The goods service tax has increased from 15 % to 18%.

Some of the vital points are explained as:

  • You have to be very careful while buying a health insurance policy. You should see the coverage of the health insurance policy. Family health insurance policy weighs over the individual health insurance policy. You should keep a check on the reputation of health insurance agents. You should also see the network of hospitals covered in the health insurance policy.
  • Goods and Services Tax on a health insurance policy is the single indirect tax paid on the premium of a health care policy. As the tax on the health care policy increases there is a premium increase also. The insurance companies are worried about decreasing customer base because Indians in general and particularly the policy buyers are worried about the increase in the premium rate. As the increase in the premium rate affects the business of insurance policy buyers. To make up for the decreasing customer base the insurance companies are providing healthcare policies at affordable rates.
  • There is an advantage for the policy buyers as the process of the purchase of the policy and the process of registration of the claim has become easy. The cost is less on the issuing policies so there is a saving for the buyers. Paying off additional tax on the premium of the policy by the existing policyholders is now according to the present Goods and Services Tax rates. There is no input tax credit facility for individual policyholders and this advantage is also not available for group policyholders.
  • Previously the buyer of health insurance policy was subjected to concessional rate of service tax on insurance policy. The buyer had to pay a 3.75% s concessional rate on unit link investment policy an endowment plan. The renewal premium was 1.87 5% during the first year when the additional tax was 15% but now it has increased to 4.5 0% as concessional rate and 2.25% as renewable premium.
  • The increase in the Goods and Services Tax to be paid on the premium of the healthcare policy has affected the budget of the buyer. This increase in Goods and Services Tax has induced competition in the market of health insurance companies. There is a down sliding in the customer base as the customer is worried about the hike ok in the premium to be paid on the health care policy. The insurance companies have started offering health insurance policies at an affordable rate.
  • The Care Insurance company provides you the best healthcare policies with affordable premium rates. This is one of the best companies that have the reputation of high claim settlement ratio, maximum coverage, the maximum network of hospitals, reputed insurance agents, and the seamless process of claim settlement that is cashless.
  • Goods and services tax is applicable on the premium m of the healthcare policy in all the states of India. The Goods and Services Tax to be paid on the premium of health care policy is 18% that is the same for all the states and union territories of India. This tax is not refundable.
  • The additional tax to be paid on the premium of the healthcare policy has increased to 18% but this increase has affected the insurance companies on a large scale the person who is buying the insurance policy should keep in mind the tenure of the policy having the maximum coverage. Ambulance charges, Daycare treatments, diagnostic charges, medical checkups, and Maternity charges are increasing day by day; if these charges are added in the healthcare policy as the sub-limits then this is the right policy for your family members.
  • Goods and Services Tax was introduced by the Indian government in the year 2006 to unify the basic levying living off tax on services and goods and different transactions. The increase in the additional tax to be paid on the premium of the health insurance policy has induced the insurance companies to lower down the prices while issuing the policy. This has been done to attract customers. They have also increased the facilities available in the health insurance policy right from the issuing of the policy and setting the settlement of the claim.

So paying the premium on the health insurance policy should not be the criteria for buying the health insurance policy. The benefits of buying a health insurance policy are more than the additional tax to be paid on the premium. You can safeguard the future of your family during a medical emergency.

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