What is GST on Health Insurance?

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GST on health insurance refers to a tax charged on the premium paid for health insurance policies in India. Earlier, health insurance premiums were subject to an 18% GST, which was applied on the premium amount paid to the health insurance policyholder and not to the claim amount.


However, according to the 56th GST Council meeting held on 22nd September 2025, all individual health insurance policies, including family floater plans, senior citizen plans, and their reinsurance services have now been exempted from GST. This clearly indicates that the policyholders need to pay only the base premium amount without any GST


For instance, before the exemption, if you have health insurance and its annual premium is around Rs. 10,000, then an additional Rs. 1,800 was charged as GST, so the total payable amount would be Rs. 11,800. But now, if you buy a policy for 10,000 then no additional tax is charged, which means you only need to pay the base premium.


However, group or corporate health insurance policies still attract 18% GST.


Let’s discuss the types of GST:


CGST or Central GST: It is collected by the Central Government


IGST or Integrated GST: It is collected by the central government for inter-state transactions.


SGST or State GST and Union Territory GST or UTGST: It is collected by the State Government or Union Territory on intra‑state transactions


Does GST apply to all Health Insurance Policies?


GST is not applicable to most individual health insurance policies, such as:


Individual health insurance plans


Family floater health insurance plans


Senior citizen health insurance policies


Top-up plans


Super top-up plans


Critical illness plans


Can GST on Health Insurance be Claimed as a Deduction?


No, GST itself cannot be claimed as a separate tax deduction. However, the total premium paid (including GST) can be claimed as a deduction under Section 80D of the Income Tax Act.



  • Up to Rs. 25,000 for self, spouse, and dependent children

  • An additional Rs. 25,000 for parents

  • Up to Rs. 50,000 for senior citizens


Apart from this, the Rs. 5,000 limit applies only to preventive health checkups.


Earlier, GST used to increase the premium amount, but now individual health insurance policies are exempt from GST. Policyholders can still claim tax benefits under Section 80D of the Income Tax Act on the overall premium amount paid.


Conclusion


Lately, GST does not apply to individual health insurance policies, including family floater and senior citizen plans. This makes it more affordable for policyholders.