2020-2021 budget expectations for the insurance sector: To reduce the distress of farmers, the government is strongly emphasizing the importance of agricultural insurance, and the adaptability of life and health insurance is also increasing due to the increased level of awareness, but demand for Other insurance products – like fire insurance, home insurance etc. – are negligible.
Owing to the non-transfer of risk, homeowners often face significant losses and financial hardship after the occurrence of such insurable events.
“Insurance is an important social security tool, closely linked to our economy. From insuring the backbone of our economy, i.e. farmers through crop insurance, to taking on new age risks such as cyberthreats through cyber insurance, insurance is there to protect most of the risks we face today. Therefore, I think it becomes even more crucial to provide much needed impetus to the industry in the form of the measures below to continue to protect both the economy and society from unforeseen risks ”, said Comment on behalf of Tapan Singhel, Managing Director and CEO, Bajaj Allianz General Insurance.
With the exception of compulsory insurance – such as automobile insurance – the penetration of other insurance is much lower in India. To improve the level of penetration, insurance industry players want the government to provide tax breaks and incentives.
“On the direct tax front for individuals, I believe that the government should grant a tax exemption to people who opt for home insurance. Thus, providing them with much needed motivation, especially in light of the increase in natural calamities that are leaving people stranded. This can be done by providing a separate limit beyond the already biased limit of 80 ° C, ”Singhel said.
You must beware! Your nominee may not receive the insurance money after your death; here’s why
While most lenders require borrowers to insure property – real or personal – purchased on loan for financial security, tax breaks can make people take out insurance voluntarily.
“Regarding indirect taxation, there is a direct need for the government to reduce GST rates on insurance premiums given the low penetration of insurance in India and the fact that insurance aims to provide a financial support against sudden human or economic loss ”. Singhel said.
“The above measures, I believe, will go a long way not only in making the insurance industry more favorable, but will also lead to increased insurance penetration with the appropriate support from all stakeholders.” , he added.