Page 38 - The Insurance Times May 2021

Gifting health insurance:
Getting expensive gifts and ornaments are surely enticing
for everyone, however, securing one's family's health and
future should be of utmost importance. Health is one of the
most important aspects of life, whether it is for self, spouse,
or the entire family. The health of one single person getting
affected in the family disrupts peace and happiness of all
other family members. To add to it, COVID-19 has taught
each one of us the true value of life and significance of
securing a family's health. If you want to include immediate
family members like parents, wife, children, and other
dependants, then a family floater plan is the best gift.

This type of plan offers coverage to family members at a
single premium instead of multiple individual premiums. One
has to note that, while family floater will give one the health cover. The reducing GST makes sense as only luxury
advantage of covering his whole family at a low premium and non-essential products attract 18 per cent GST.
and larger sum assured, the premium will typically depend
upon the oldest member of the family. A higher premium Even if the government is concerned about the loss of
needs to be paid in that case. If the family floater is for the revenue due to decrease in GST rate, on the contrary,
husband, wife and no children, a lower premium will work bringing health insurance in lower tax bracket might benefit
as are all young and healthy. Maternity Health Insurance the government by the way of enhanced penetration. As in
is one gift which can be specifically gifted to the wife. For developed countries, governments provide health insurance
newly married couples, who would sooner or later plan for to its citizen, the least government in India should do is to
a family, this can be a perfect investment. put it under the lowest tax bracket. The implication of
levying 18 GST on health insurance ought to be evident from
The plan covers expenses such as pre-natal, post-natal, these figures given the fact that the private health sector is
delivery charges and charges of the ambulance. Not just now the major player in dispensing both the inpatient and
that, the plan also covers charges of infertility and offers outpatient health care.
coverage. A health insurance policy should not be treated
as an option but a necessity in today's life. Health problems In the six-month period from April to September 2020,
have intensified due to the changing lifestyles of people health insurance became the most valuable segment for
across the world. One wave of COVID-19 has proved, how non-life insurers in terms of premiums collected,
critical, health emergency can be and why we need to keep leapfrogging motor insurance. This is happening for the first
ourselves prepared for the worst times. Hence, a well- time since the industry was thrown open to private players
thought-out insurance policy can be one of the most about 20 years ago. Health insurance accounted for 29.7%
effective gifts. of premiums collected by non-life insurers in the first half
(April to September) of 2020-21. Motor insurance came in
GST on health insurance: a close second, with 29% of premiums. In 2014-15, the share
Health and finance experts argue that medical insurance has of health was 23.4% and motor 44.4%. Historically, health
emerged one of the basic products during the pandemic and premiums have been driven by 'group policies' or
government should not make money out of people miseries. organizations buying an umbrella cover for their employees.
India, being a welfare state, should provide affordable
healthcare especially in these unprecedented times of In the post-pandemic phase, the momentum came from
pandemic as part of the fundamental right to life individuals buying policies. Premiums paid on individual
guaranteed under Article 21 of the Constitution of India. policies increased by 34% in the Apr-Sep period compared
Clearly, these are not the times for the government to tax to the year-ago period, against 16% on group policies. As a
or earn revenue from public health. Rather it is the time to result, the share of individual policies in the health premium
subsidize the life-saving measures be it healthcare or the pie increased from 36% to 41%. Premiums in the

38 The Insurance Times, May 2021