Insurers bat for I-T relief for premiums

After the rationalisation of goods and services tax (GST) on insurance premiums, the insurance industry is now seeking enhanced income tax (IT) benefits for protection and health plans under both tax regimes, stronger support for pension products, and an increase in the premium threshold for taxing maturity proceeds of high-value policies from ₹5 lakh to ₹10 lakh in the Union Budget for 2026-27 (FY27).

- AATHIRA VARIER

Insurers are also seeking the tax-free maturity limit for Unit Linked Insurance Plans (Ulips) to be raised to ₹5 lakh.

Satishwar B, managing director and chief executive officer (MD&CEO) of Bandhan Life Insurance, said ‘he GST waiver has made life insurance more affordable and accessible. We are hopeful that this year’s Budget will continue that momentum. Better tax benefits for protection and health plans— under both tax regimes —can help more families get covered. We also hope to see stronger support for pension products, and an increase in the premium cap for Ulips to ₹5 lakh, similar to traditional plans. Simple, inclusive reforms can go a long way in securing India’s financial future and accelerating progress towards ‘Insurance for All by 2047’”.