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Hike in premium exemption, indication on GST cut on premium budget expectations of insurers

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GST

An indication on reduction in the Goods and Services Tax (GST) rate on health insurance, giving infrastructure status to healthcare facilities, hiking tax deduction for insurance premium are some the budget wishes listed out by the insurance sector.

Senior industry officials also urged the government to take steps to increase the insurance penetration in the country.

Even though the GST rates does not form part of the union budget, insurers want an indication towards slashing of the rates on insurance premium in the Finance Minister Nirmala Sitharaman’s budget speech.

“Health insurance is an essential commodity and needs to be slotted in the five per cent GST tax slab to make it more affordable to access quality healthcare,” said Anup Rau, MD & CEO, Future Generali India Insurance

A significant reduction in the GST on all personal lines of products-from the existing 18 per cent to five per cent will encourage more people to buy health insurance. For senior citizens, it should be exempted.

According to Rau, increasing the tax deduction limit in Section 80D of the Income Tax Act – from Rs 25,000 to Rs 150,000 – can further help in penetration of health insurance.

“The rising medical costs and the increase in the incidence of critical illnesses make it an unmanageable expense for middle-income and lower-income groups. So, a higher tax deduction limit for health insurance plans is the need,” he argued.

Given the under-penetration of insurance in India and the need to bring a wider gamut of population under the safety net, small ticket size insurance products like micro-insurance, sachet products, etc. can be exempted from GST, Rau added.

The services by the healthcare providers don’t fall under the GST radar while at the same time buyer of the health insurance product pays the same given a large portion of the coverage is directed towards the cost of hospital bills, remarked Yogesh Agarwal, Founder & CEO, Onsurity, an insurance-health tech startup.

“In the upcoming union budget, we request the Government to intensify steps towards increasing insurance penetration in the country, since even today a large part of the population in the country still remains underinsured or uninsured,” Roopam Asthana, CEO & Whole-Time Director, Liberty General Insurance said.

Citing the 2020-21 annual report of the Insurance Regulatory and Development Authority of India (IRDAI) Asthana said, the insurance penetration in India stands at 4.2 per cent of the gross domestic product (GDP) as against a global average of 7.4 per cent.

Asthana said as of March, 2021 the non-life insurance penetration in India stood at barely one per cent and urged the government to slash the GST from 18 per cent.

“Further even though GST is not covered under budget, however policy makers’ should also look towards exempting or lowering GST rates on life insurance products and these should ideally be classified under essential product category,” Tarun Rustagi, Chief Financial Officer, Canara HSBC Oriental Bank of Commerce Life Insurance said.

According to Rustagi, life insurance premium should be given a separate deduction limit of Rs 100,000 under Section 80C of the Income Tax Act.

Also, pension products should be given parity with NPS in tax incentives.

Further, for annuity products, deduction for principal component should be allowed and only the interest accretion should be taxed similar to fixed deposits.

Suitable changes should also be made under section 10(10D) to allow exemptions for all Life Insurance products where life insurance coverage is present which may be on the basis of policy term and sum assured ratio.

Crime

Man who issued death threat to Delhi CM Gupta, arrested from Ghaziabad

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New Delhi, June 7: A man who issued a death threat to Delhi Chief Minister Rekha Gupta has been arrested by a team from the North-West District Special Staff of the Delhi Police.

The accused was apprehended from Ghaziabad following swift investigative efforts after the threatening call was made late on Thursday night.

According to police officials, the threat call was made to the Ghaziabad Police Control Room (PCR) while the accused was allegedly under the influence of alcohol.

Shortly after the threat was received, the Delhi Police Control Room was alerted, and the matter was escalated due to the high-profile nature of the target.

Investigators identified the caller and tracked his location, but by the time authorities reached the source, the suspect had switched off his mobile phone.

After intensive tracing efforts, the Special Staff managed to arrest him from a hideout in Ghaziabad.

Preliminary interrogation has revealed that the accused is a law graduate (LLB), who had been facing personal turmoil due to a troubled marriage. His wife had recently left him, which reportedly pushed him into emotional distress.

Before making the death threat, he had placed another call in which he demanded to speak to his wife, police said.

Interestingly, the accused was found in possession of fake identification cards that appeared to be police credentials, raising suspicions that he may have attempted to impersonate law enforcement personnel.

Officers stated that he repeatedly tried to mislead the police during questioning.

“Assessment of the threat perception of VIPs or VVIPs is conducted by security agencies on the direction of the Ministry of Home Affairs (MHA),” a senior Delhi Police officer said.

Chief Minister Rekha Gupta is entitled to Z-category security under the standard protocol. Security agencies are expected to reassess her security cover following this incident, officials confirmed.

Police are continuing their investigation to determine whether the accused has any prior criminal history or links to other disruptive activities.

Authorities have also launched a separate enquiry into the use of forged police IDs found in his possession.

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National

Bakrid 2025: Muslims across India celebrate Eid al-Adha with prayers, sacrifice

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New Delhi, June 7: Muslims across India are celebrating Bakrid, also known as Eid al-Adha, on Saturday with religious fervour and devotion.

The day began with special congregational prayers held at mosques and Eidgahs in cities and towns nationwide, as people gathered in large numbers to mark the sacred festival.

Eid al-Adha, or the “Festival of Sacrifice,” honours the unwavering faith and obedience of Prophet Abraham, who was willing to sacrifice his son as an act of submission to God.

In commemoration of this act of devotion, Muslims around the world perform ‘qurbani’, the ritual sacrifice of animals such as goats, sheep, or buffalo, and distribute the meat among family, friends, and those in need.

In India, the festival is being observed with great enthusiasm. In Delhi and Noida, large numbers of devotees offered Bakrid prayers early in the morning at major mosques. According to announcements from local mosque committees, Namaz timings varied slightly, in Noida, prayers were held around 7:00 a.m., while in Greater Noida, the timings ranged from 6:45 a.m. to 8:15 a.m. depending on the mosque.

In Kalyan, Thane district of Maharashtra, police presence was heightened near the historic Durgadi Fort due to parallel events planned by the Thackeray and Shinde factions, both claiming to continue the legacy of Dharmaveer Anand Dighe’s “Ghantanaad” movement, a 39-year-old tradition.

In other parts of India, the celebrations continued peacefully.

In Khurja, Bulandshahr, Uttar Pradesh, large crowds assembled at the Eidgah for morning prayers.

In Bhagalpur (Bihar), thousands gathered at Tatarpur Masjid, CTS Ground, and Shahjangi Maidan to offer prayers. Similarly, in Bhopal (Madhya Pradesh), Eidgah Mosque saw significant attendance during the morning Eid al-Adha Namaz.

Bakrid celebrations are expected to continue throughout the day, with families coming together for festive meals, acts of charity, and community bonding.

Authorities across major cities have deployed additional security to ensure peaceful observances.

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National

J&K CM Omar Abdullah makes passionate appeal for statehood restoration

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Jammu, June 6: During his welcome address to Prime Minister Narendra Modi in Jammu and Kashmir’s (J&K) Katra town on Friday, Chief Minister Omar Abdullah made a passionate appeal for restoration of statehood.

During his welcome speech for the Prime Minister, CM Omar Abdullah said, “Jenab-e-Wallah (exalted sir), when you inaugurated the Katra railway station towards the end of my first term as the Chief Minister, Manoj Sinha ji was the Union Minister of State for Railways.

“He has been promoted as the Lieutenant-Governor while I have been demoted from the Chief Minister of a state to that of a Union Territory. I am confident that your goodself will soon address the issue and announce statehood to J&K”.

He also praised the Prime Minister for making the dream of a rail link to the Valley a reality.

“I was in class 8 and since then I have been hearing about a rail link to the Valley. The dream has been realised in your time sir.

“The start of the train service to the Valley will save us from the loot of the airlines companies who hike airfare to Jammu from Rs 5,000 to Rs 25,000 whenever the Srinagar-Jammu highway gets blocked.

“I must also pay my gratitude to Atal Bihari Vajpayee, who declared the rail link to the Valley a national priority project and made financial allocations for it,” CM Omar said.

On the stage with PM Modi, CM Omar’s body language was very cordial as the PM engaged him in some close to ear talk.

He was also in the forefront of all the official functions on Friday, including the inauguration of the Chenab Railway Bridge, the Anji cable stayed railway bridge, the flag-off ceremony of two Vande Bharat trains, one from Katra to Srinagar and the other from Srinagar to Katra.

CM Omar was among the dignitaries who welcomed the PM on the stage before the latter’s address to the public in Katra stadium.

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