Insurance Companies are demanding an increase in the tax deduction limit for mediclaim policies, under section 80D of the Income tax act.
Industry veterans are of the opinion that the insurance penetration in India is extremely low and there needs to be a concerted effort to make policies more attractive for the common man.
R.K. Kaul, Chairman-cum-MD, Oriental Insurance Company said that the limit for rebate for mediclaim under section 80D should be increased from Rs. 15,000 to Rs. 25,000 for individuals to provide boost to the health insurance. This will also allow people to opt for higher coverage to cover higher medical cost.
Amarnath Ananthanarayanan, MD and CEO, Bharti AXA General Insurance also said, “The 80D tax exemption limit for health insurance could be increased to Rs. 50,000 to be in line with health care cost inflation.”
Most people invest in an insurance policy in a bid to save tax. Apart from third party motor insurance, which is mandatory by law, customers in India are not compelled to buy any other insurance policy.
Insurance companies in the non-life sector are also requesting for waiver on service tax on the premiums. Companies are eagerly waiting for the budget which is due to release shortly.
