Insurance for All: Key Expectations from Budget 2025

Insurance sector reforms could ensure wider coverage, robust financial resilience

- Parimal Heda

For India to achieve consistent economic growth and its target of becoming the third-largest economy by 2027, a robust financial system is essential, with the insurance sector playing a key role. The sector is critical for bridging protection gaps, enhancing financial resilience, and driving sustainable growth. Insurance regulator IRDAI aims for 'insurance for all' by 2047, ensuring life, health, and property cover for citizens and appropriate solutions for enterprises. To support this, IRDAI has implemented initiatives to create a forward-looking regulatory framework, enhancing choice, accessibility, and affordability for policyholders. In Budget 2025-26, the government could accelerate this mission with targeted support for the insurance sector.

Buying health insurance early on: The government could incentivize first-time health insurance buyers, especially those below 30, by offering a multiplier-based tax deduction (e.g., 150% of premium paid). A similar, but one-time tax benefit, could also be extended to first-time buyers.