Is GST really going to withdraw from health and life insurance? Know the complete truth of this news:

News India Live, Digital Desk: GST on Insurance Policy: In view of today’s run -of -the -mill life and increasing diseases, taking health and life insurance has become a need, not luxury. But when we fill the premium of the policy, the 18% GST (Goods and Services Tax) on it is quite heavy on our pocket. Now think, what will happen if this GST is removed? Recently, a news related to this has raised a new ray of hope in the minds of millions of policyholders.

The news is that the Insurance Regulatory and Development Authority of India (IRDAI) has recommended the government to completely remove GST from health and life insurance policies. If the government accepts this recommendation, then it will be a big relief for all of us.

What is the whole matter and why did this demand arise?

Actually, IRDAI aims to have an insurance cover in India by 2047. But the huge 18% GST on the premium is a big obstacle on this path. Most people either shy away from buying insurance or they run with a low cover policy. IRDAI chairman Debashish Panda believes that insurance is a kind of social security, not a luxury item. Therefore, GST should not be imposed on it.

How much will you benefit if you remove GST?

Let’s understand it with an easy example. Suppose you pay a premium of Rs 20,000 annually for a health insurance policy. On this 20,000 rupees, you have to pay 18% GST, ie 3,600 rupees separately. In this way, a total of Rs 23,600 goes from your pocket.

If the government accepts the recommendation of IRDAI and removes GST completely, then you will save Rs 3,600 directly. That is, the policy that was falling for Rs 23,600, will now be available for just Rs 20,000. The same rule will apply to life insurance policies, which can increase your savings even more.

What is the situation now?

It is important to understand here that it is just a recommendation. IRDAI has put its demand before the Finance Ministry. Now the final decision has to be taken by the government and GST Council. But the way the emphasis is being placed on increasing the reach of insurance in the country, this recommendation is expected to be considered seriously.

If this decision is applied, then not only will the burden of existing policy holders be reduced, but more and more people will also be encouraged to buy insurance.