GST Council to Discuss Insurance Premium Rate Cuts in 55th Meeting

The agenda includes exempting GST on individual term life insurance and health premiums for senior citizens with coverage up to INR 5 Lakh.

The 55th GST Council Meeting is scheduled to take place on December 21-22, 2024, in Jaipur, with a focus on reducing GST rates on insurance premiums.

The agenda includes exempting GST on individual term life insurance and health premiums for senior citizens with coverage up to INR 5 Lakh.

Group of Ministers (GoM) has already recommended these changes, as reported by ET NOW.

Low Insurance Penetration Spurs Need for Reform

India’s general insurance penetration remains at 1%, significantly lower than the global average of 4%. Despite low penetration, the government collected INR 8,000 Cr in GST from health insurance premiums in FY24. A reduction in GST rates could improve affordability and accessibility, particularly as health awareness grows nationwide.

Amendments to the Insurance Act are also expected in the upcoming winter session of Parliament.

Proposed changes may include provisions for differentiated insurers, composite licenses, and value-added services.

However, these reforms are likely to follow the GST Council’s decisions regarding insurance premium rates.

Stay tuned for more such updates on Digital Health News.