'Cost Of Insurance To Come Down If...' - FM Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on Monday stated that the cost of health and life insurance policies could decrease if the GST Council recommends reducing the GST rate on premiums. This would make insurance more affordable for policyholders.
The GST Council, in its September 9 meeting, proposed forming a Group of Ministers (GoM) to examine issues related to GST on life and health insurance. The GoM’s recommendations will play a key role in determining any reduction in rates.
“The matter of review of GST rates on life and health insurance is pending before the GoM. If a recommendation for a reduction in GST rate is made by the GST Council, the cost of insurance to the policyholder is expected to come down on account of reduction in GST," she said. 

GST Rate: Demand for Removal

The All India Life Insurance Employees' Federation (AINLIEF) has called for the complete removal of GST on insurance premiums. The group announced a nationwide campaign to advocate for this demand and oppose further increases in foreign direct investment (FDI) in the insurance sector.

"As the GST rates are applicable over and above the insurance premium, if the GST rate is reduced, it is expected to benefit the policyholder directly especially in a competitive market with many insurers as the cost of insurance will reduce to that extent," Sitharaman added.

GST Rate: Movement Began

Recently, as part of its campaign, AINLIEF plans to launch nationwide demand and approach Members of Parliament across political parties. General secretary V Narasimhan said he will be approaching MPs from all political parties to voice support for the demands.