A Guide on Health Insurance Tax Benefits
If you or your loved ones require medical care, a health insurance policy can be of immense help. With health insurance, you do not ha ve to worry about arranging funds for heavy medical expenses at the eleventh hour. Yet, the benefits of having coverage don’t end there. Were you aware that you can also get health insurance tax benefits as a policyholder? Let’s find out more.
What are Health Insurance Tax Benefits?
The health insurance premium paid is eligible for tax deductions under Section 80 D of the Income Tax Act, 1961. The medical insurance premium 80D deductions offered are as follows:
- If the health insurance covers you and your family (excluding parents) who are all under the age of 60 years, you can claim a deduction of up to Rs 25, 000.
- If the health insurance covers you, your family, and your parents who are all under the age of 60 years, you can claim a deduction of up to Rs 50, 000.
- If the health insurance covers you and your family who are below 60 years of age, and your senior citizen parents who are above 60 years of age, you can claim a deduction up to Rs 75, 000.
- If the health insurance covers you, your family, and your parents wherein every individual is above 60 years of age, you can claim a deduction of up to Rs 1,00,000.
Who Can Claim These Benefits?
The health insurance premium tax deduction benefit is available for individuals or members of HUF (Hindu Undivided Family). Individuals can claim the benefit for themselves, their spouse, dependent children, and parents.
A Few Points to Note on Medical Insurance Tax Benefits
- You can claim a tax deduction of up to Rs 5,000 for expenses borne on medical check-ups or preventive health check-ups within the limits specified above.
- Tax deductions on health insurance premiums are available to non-resident Indians (NRIs) as well.
As we can see medical insurance tax benefits for senior citizens tend to be on the higher side.
What are the Conditions Associated with Medical Insurance Tax Benefits?
While you can avail tax deductions via health insurance policies, these benefits are subject to certain terms and conditions. For instance, while you can make health insurance premium payments in cash, you will not be able to avail tax benefits if you do so. This is because the income tax rules in India do not allow deductions on premiums paid via cash. Thus, to avail tax benefits, it is better that your use payment modes other than cash for your insurance premiums. You can choose to pay health insurance premiums via other modes of payment like credit cards, cheques, internet banking, drafts, etc.
Tax benefits on medical insurance will encourage more people to purchase coverage for their own financial wellbeing. Remember to keep health insurance renewed each year so that you can continue to enjoy the benefits of uninterrupted coverage. All members of your family, irrespective of their age, can benefit from the coverage that health insurance brings.
Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale.