‘More tax benefits for health insurance a welcome move‘

Tarun ChughPNB Metlife

The Honourable Finance Minister has presented a pragmatic budget with a long-term perspective creating job opportunities for the youth, increasing investment in infrastructure while keeping the fiscal deficit in check. We welcome the proposal to increase the tax benefits for health insurance from Rs 15,000 to Rs 25,000. Currently, over 78-80% of health care expenses are funded by the Indians out of their own pocket and this move will encourage people to increase their coverage keeping in the mind the rising cost of healthcare.

The proposal to make the ordinances into a law is a positive move and we hope that the same is implemented quickly as it will help the insurance sector bring in additional capital of close to $3.5bn.

From the social security perspective, it is a positive move to increase tax benefits by Rs 50,000 for people investing in pension products. In India, there are 80 crore people below 35 years of age who need to start planning quickly for their retirement. And 71% of them are concerned about running out of money in their retirement years. This will add pressure on social security and retirement needs. Being a young country, there is a huge potential for pension plans as one needs to invest early to build a corpus for retirement years. We hope that the Government considers passing on these benefits to people investing in private pension funds beyond NPS.”