Health Insurance Offers Double Benefit
Health Insurance is a crucial instrument that provides you and your loved ones financial security in times of need. Thus, whether an emergency or a planned hospitalisation, a health insurance policy ensures umbrella coverage by helping you pay for the covered medical expenses in case of hospitalisation due to illness or injury.
What's more, other than safeguarding your finances from hospitalisation expenses, you can avail tax benefits on the premiums paid towards your health insurance under Section 80D of the Income Tax Act, subject to terms and conditions. This makes a Health Insurance plan a favourable tax-planning tool that adds a feather to the cap on your investments.
*Deductions under Section 80D:
| Description |
Medical Insurance Premium paid for |
Total Deduction^ under Section 80D |
|
Self, Spouse and Dependent Children |
Parents (whether dependent or not) |
|
| No one has attained the age of 60 years |
₹ 25,000 |
₹ 25,000 |
₹ 50,000 |
| Assessee and his family is less than 60 years and parents are above 60 years of age |
₹ 25,000 |
₹ 50,000 |
₹ 75,000 |
| Assessee and his parents have attained the age of 60 years and above |
₹ 50,000 |
₹ 50,000 |
₹ 1,00,000 |
Note: You cannot claim premiums paid for your in-laws, brothers, or sisters.
^Tax deductions under Section 80D is as per applicable provision of the Act (including any amendments thereto) and are subject to changes in the tax laws. Source: incometaxindia.gov.in/
Health insurance tax benefits are great for your financial planning. However, here are a few things you should know to understand the tax deduction under section 80D better.
- As per the income tax section 80D, health insurance premiums paid in cash are excluded from the tax exemption clause. This means that you will not be eligible for tax benefits. Further, the health insurance premiums should be paid by only a taxpayer as the tax benefits cannot be claimed by a third party. All other modes of payment such as demand draft, cheque, net banking, debit and credit cards are eligible for tax exemption.
- Tax exemptions are valid only on the health insurance premium and not on additional charges, such as GST, service charge, etc.
- Health insurance plans, including family floater plans that covers your spouse, children and dependent parents, makes you eligible for tax benefits.
- If your health insurance is comprised of critical illness cover add-on, then the premium paid for the add-on can also be claimed for tax deduction.
Mode of payment
Except cash, any mode of payment is acceptable for claiming deduction under Section 80D.
The ICICI Lombard advantage
ICICI Lombard offers Complete Health Insurance, Super Top-Up Health Booster and Personal Protect plan,which give you a comprehensive solution in times of medical and non-medical emergencies.
You can get an extensive coverage for individual or for your entire family with a single policy and save tax easily.Visit our Health Insurance page to know more!