New Delhi, September 4 (H.S.): In a significant relief for policyholders, the GST Council has decided to exempt personal life and health insurance premiums from Goods and Services Tax (GST), making these policies more affordable. The revised rates will come into effect from September 22, coinciding with the beginning of Navratri.

Finance Minister Nirmala Sitharaman, addressing a press conference after the 56th meeting of the GST Council, announced that all categories of individual life insurance policies as well as their reinsurance will now be exempt from GST. This includes term life, ULIPs (Unit Linked Insurance Plans), and endowment policies, which until now attracted an 18% GST. With this decision, such products will now fall under the zero-tax category.

The exemption will also extend to all personal health insurance policies—including family floater plans and senior citizen coverage—along with their reinsurance. According to Sitharaman, this move will not only reduce the financial burden on households but also help in expanding insurance penetration across the country.

In addition to insurance, the Council has also reduced GST rates on several essential items in the healthcare and food sectors. Sitharaman informed that 33 life-saving medicines have been moved from the 12% GST slab to complete exemption. Moreover, three critical drugs used in the treatment of cancer, rare diseases, and chronic illnesses have also been made completely tax-free.

On the consumer goods front, UHT milk, paneer, as well as various forms of Indian breads such as roti, chapati, and paratha will now attract zero GST. These revised rates will be applicable nationwide starting September 22.

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Hindusthan Samachar / Jun Sarkar