An investment analyst has alleged that despite the government’s directions to insurance companies to proactively pass on the benefits of GST reforms to policyholders, the latter are arbitrarily increasing premiums of life and health insurance.
Health and life insurance, which earlier attracted 18 per cent GST, have now been moved to the nil tax category.
After crying for so long that GST should be reduced, when the Government has eliminated GST on Life and Health insurance they are quietly increasing premiums quoting loss of ITC benefits,” Sabharwal wrote on microblogging site X.
“The insurance industry is the most Consumer Unfriendly and is duly supported by a friendly regulator. There is no control on how premiums are calculated or increased. Claims are denied left, right and centre and now. After crying for so long that GST should be reduced, when the Government has eliminated GST on Life and Health insurance they are quietly increasing premiums quoting loss of ITC benefits,” Sabharwal tweeted.
Sabharwal has also alleged that Insurance regulator IRDAI is not doing anything to stop the practice. He has tagged the @FinMinIndia and @PMOIndia to evaluate the working of IRDAI.
It may be noted that M. Nagaraju, Secretary, Department of Financial Services (DFS), chaired a meeting with senior officials of DFS, IRDAI, CMDs of public sector insurance companies and CEOs of leading private sector life and non-life insurance companies and officials from Life Insurance Council and General Insurance Council yesterday.
The secretary highlighted prospective positive impact of the GST reforms in making insurance more affordable and accessible for the common man.
The measure is expected to make insurance more accessible and cost-effective, thereby strengthening financial security and enhancing insurance penetration across the country, according to a Finance Ministry statement.
The meeting was held in pursuance of the exemption of GST on all individual life and health insurance policies as approved by the GST council in its 56th meeting.
According to a report by rating agency ICRA, policyholders will benefit from lower premiums.
With IANS Inputs
