Insurance, as a product, serves the primary purpose of acting as a tool for protection. In a young and growing economy like India, it is imperative that insurance finds its way into every household. However, along with serving as a tool for protection, it can also be a great tax planning instrument. The FM can use tax SOPs to further incentivise the end-user to buy insurance. These could include enhancing the deduction limit under section 80C, increase the cap for allowable deductions under section 80D and reduce the GST on all personal lines of products. The FM can also consider introducing a new deduction specifically for women insurance buyers and first-time insurance buyers. Such steps would not only have a positive impact on the insurance sector but also help individuals with their financial plans.
(Dhirendra Mahyavanshi is the Co-Founder of Turtlemint)
Published 28 January 2020, 16:47 IST