Need For Higher Limits, Revised CBDT Definition For Inclusive Insurance
As we approach the eagerly awaited Budget 2024, the insurance industry is poised for transformative changes. The vision of 'Insurance for all by 2047,' set forth by the Insurance Regulatory and Development Authority of India (IRDAI), adds significant importance to the upcoming budget. In this context, there are several key expectations and policy recommendations that, if implemented, could add impetus to the insurance industry’s efforts in this direction.
Rethinking 80D Section
One crucial aspect that requires attention in the upcoming budget is a reevaluation of the 80D section. Specifically, an increase in the limit and a revision in the Central Board of Direct Taxes (CBDT) family definition could go a long way in fostering a more inclusive environment. This would also help in encouraging a wider population to avail insurance benefits. The current scenario calls for a fresh perspective that acknowledges the evolving nature of familial relationships.
Recommendations for Inclusivity
A progressive step towards inclusivity would be extending the benefits provided under the 80D section to domestic partners. This move, with a special focus on supporting the LGBTQIA+ community, aligns with the broader societal shift towards recognizing and embracing diverse family structures. By offering insurance benefits to domestic partners, the government can take a proactive stance in promoting inclusivity and equal rights.
Furthermore, a comprehensive review of the CBDT's family definition is essential to capture and address the nuances of modern relationships. The redefinition should consider the diverse familial structures prevalent in society today, acknowledging the significance of non-traditional bonds.
GST Relief on Room Rent
Another area that warrants attention is the Goods and Services Tax (GST) on room rent, especially in metropolitan areas where the cost of healthcare services, particularly in major private hospitals, is considerably high. It is recommended that the 5% GST on room rent exceeding INR 5,000 be removed to alleviate the financial burden on patients seeking medical care in urban centers.
By relieving this tax burden, the government can contribute to making healthcare more affordable, thus promoting better health outcomes for the citizens. This move aligns with the broader objective of ensuring access to quality healthcare for all, a fundamental component of the IRDAI's vision for the insurance sector.
Insurance innovation for Climate-Resilient Products
The country has witnessed extreme weather events in the recent past that resulted in the loss of human lives and damage to property. According to the Climate India 2023 report, there were around 2923 deaths and more than 80,000 homes were damaged. A lot of these property losses were uninsured. The upcoming budget could contain policy measures to motivate customers to adopt property insurance and also encourage Insurers to launch relevant products. The budget could also allocate resources for the development and implementation of advanced technologies like artificial intelligence, blockchain, and data analytics for better assessment of climate based risks and weather patterns. These policy measures will provide impetus to the property insurance segment and also help to mitigate the financial losses for the consumer.
Fostering Inclusive Landscape
In conclusion, as the nation anticipates the unveiling of Budget 2024, the insurance sector stands at a transformative juncture with technological innovations and changing consumer dynamics. The extended benefits under the 80D section and the removal of GST on high room rents would enhance the accessibility and penetration of insurance, making it a more viable option for a broader segment of the population. By embracing inclusivity and addressing the evolving dynamics of familial relationships, the government can take a giant stride towards achieving the vision of 'insurance for all by 2047' set forth by IRDAI.
