GST Reform News: Kotak Life Managing Director has said that individual companies may adjust rates based on the performance of their portfolios, but an industry-wide premium increase is unlikely in the near future
GST exemption on life insurance policies : The way we buy and avail life insurance is changing faster than ever before. From GST exemptions and the transition to the new tax regime to the launch of Bima Sugam, what do these events mean for policyholders and the industry? Speaking on these issues in an interview with Moneycontrol, Mahesh Balasubramanian, Managing Director, Kotak Life Insurance said that the GST exemption on individual life insurance is a historic move. It has made insurance products even more affordable. It has helped life insurance companies reach more people and expand their reach across the country. The Finance Minister and the GST Council should be applauded for this decision.
In the short term, insurance companies will have to rethink some economic aspects and examine issues such as input tax credit. But overall, this move by the government is a great thing for the insurance industry. It is in line with the Life Insurance Council’s message of “Life Insurance First”, as it will make life insurance more accessible.
He further said that more clarification is awaited, but he believes that from September 22, the renewable premium of life insurance is also exempt from GST. As far as the insurance expenses (actuarial calculations) are concerned, all insurance companies are working on them afresh. It is too early to say anything on this, but when there is more clarity on this, the companies will make the necessary changes.
Balasubramanian further said that it is a misconception that insurance is bought only to save tax. Although the month of March is traditionally a busy month, nowadays customers do not buy policies only for tax exemption. However, the annual exemption of Rs 5 lakh for traditional plans and Rs 2.5 lakh for ULIP matters more.
Add informalnewz.com as a Preferred Source
DISCLAIMER
We have taken all measures to ensure that the information provided in this article and on our social media platform is credible, verified and sourced from other Big media Houses. For any feedback or complaint, reach out to us at informalnewz@gmail.com
