Tax exemption limit Increased under section 80DTax exemption increased under health insurance premium in the union budget 2008 of the income tax act, this structure will motivate more individuals to invest in insurance policy.
01 Mar 2008
Non-life insurers have embraced the increase in the tax exemption limit for the health insurance premium. At present, the tax deduction limit is at Rs.15, 000 and Rs. 20,000 for senior citizens.
In the Union Budget 2008, under section 80D of the Income Tax Act, an individual can claim an additional deduction of Rs.15,000 as premium payable for medical insurance for the assessee's parent or parents.
The total umbrella limit has been increased to Rs.30, 000 for an individual assesssee and the limit for a senior citizen remains unchanged at Rs.20, 000 for medical insurance.
This change in tax structure will motivate individuals to invest more into health insurance. This will enhance the health insurance sector, covering people appropriately. This will reduce the chances of under-insurance.