Interim Budget 2024: Increase Deduction Limit For Medical Insurance Premiums Under Section 80D, Says Insurance Sector

New Delhi: The Insurance sector has said that the government should consider some important changes in life and health insurance so that more and more people can be covered in the ambit.

Aatur Thakkar, Co-founder and Director at Alliance Insurance Brokers said that government should increase the deduction limit for medical insurance premiums under Section 80D

"Insurance sector demands the increase in the amount of money that people can save on taxes when they buy medical insurance. This could help cover the higher costs of healthcare. The government needs to raise the cap for individuals to Rs. 50,000 from Rs. 25,000 and Rs. 75,000 from Rs. 50,000 for elderly persons, since rising healthcare costs demand it. In addition, with reference to the new tax system, government should expand the Section 80D deduction for health insurance premiums under the new system to guarantee that everyone benefits equally from healthcare tax breaks," Thakkar said.

Thakkar added that the Government should allow full tax deductions for life insurance premiums, encouraging more people to invest in insurance. If people buy life insurance, the government should let them save the money, they spend on the taxes for the premiums, he said.

Vaibhav Kapoor, Co-founder, Pristyn Care said, at least 30% of the population or 40 crore individuals – called the missing middle-- are devoid of any financial protection for health insurance.

"Special attention should be given to easier access to healthcare financing with regard to affordability and simplicity. The existing GST rate on health insurance should be reduced and the Foreign Direct Investment (FDI) limit should be increased to 100%. We hope that the budget will exhibit a forward-thinking commitment to the health sector, ensuring a healthier future for all,” Kapoor added.

"Budget 2024 should prioritise the development of healthcare facilities in rural India, providing the foundation for increasing awareness and adoption of insurance products. By addressing socioeconomic challenges and promoting financial literacy, the budget can play an important role in increasing insurance penetration and risk reduction among companies and individuals in non-urban areas," said Rohit Boda, Group Managing Director of J.B. Boda Group.

Meanwhile, Daniel Mazon, Vice Chairman and Managing Director, Philips Indian Subcontinent said that there is a huge potential for India to become a part of global healthcare landscape through the Government’s support in setting up Research & Development, Component and Software Development centres in the country.

"We look forward to these measures that will strengthen the healthcare outlook as we anticipate the 2024 Budget," he added.