Several insurance companies and online platforms have begun offering health and life insurance policies in India without GST, nearly two weeks before the government’s planned tax reform.
Effective September 22, 2025, the goods-and-services-tax (GST) on health and life insurance will be reduced from 18% to 0%, making policies significantly more affordable for consumers.
Early Access to GST-Free Policies
The early offers allow customers to purchase insurance policies now, with coverage starting September 22, without paying GST at the time of purchase. Anand Roy, CEO of Star Health and Allied Insurance, called the GST exemption a “landmark reform”, emphasizing that health insurance is a necessity, not an optional expense.
Alongside Star Health, online platform Policybazaar is also enabling early buyers to enjoy the benefits of the GST cut. Analysts suggest the tax reduction may encourage families to choose higher sum-insured plans, aligning with the government’s long-term goal of “Insurance for All by 2047.”
Impact on Insurers and Consumers
While insurers may face increased operational costs due to the loss of input tax credit, the reform is expected to enhance policy affordability, making health and life insurance more accessible to households across India.
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