With the implementation of GST, life insurance is all set to become a bit costly as the tax rate has been elevated from 15% to 18%. It will also have an adverse impact on the life insurance industry.
“The new GST tax rate proposed is fixed at 18% for life insurance products as against the current 15%. The higher tax rate will have an adverse impact on the life insurance industry and the cost of insurance products at large. With the elevation in the tax rate from 15% to 18%, the cost of buying insurance and keeping the policy active will increase marginally,” says Suresh Agarwal, Chief Distribution Officer, Kotak Life Insurance.
Here’s how GST will impact the premiums of different insurance plans:
