Term insurance is an essential part of any individual’s financial plan. It provides a strong foundation by actingas an income replacement tool for the family if the earning member passes away, ensuring that financial goals are still achievable.
Recently, the Indian Government introduced reforms that exempted all insurance policies from GST. Customers earlier paid 18% of the premium amount as GST, for instance, if anindividual had to pay a premium Rs.100, over and above this Rs.18 was charged as GST. With the GST exemption the individual now has to pay only Rs.100. This has made life insurance products cheaper, including term insurance products.
Specifically, ICICI Prudential Life Insurance has passed on the entire GST exemption benefit to its customers, in line with its commitment towards deliveringthe best value to its customers. Thus,making insurance plans more affordable and accessible for every Indian family.
Let us look at what the impact of this has been on the pricing of term insurance products. Earlier, a 30-year-old male, non-smoker paid a monthly premium of Rs.825, inclusive of GST. Now the same individual will have to pay just Rs.699 for a life cover of Rs.1 crore for a 30-year period.Furthermore, a 30-year-old female, non-smoker for the same cover and tenure will now have to pay a monthly premium of only Rs. 594, instead of Rs.697 including GST.
Mr. Vikas Gupta, Chief Product Officer, ICICI Prudential Life Insurance Co. Ltd., said, “At ICICI Prudential Life Insurance, we believe that true value lies in doing what’s right for our customers. Every saving we return to our customers strengthens trust, enhances affordability and moves us closer to a future where quality insurance is within everyone’s reach. It also complements the Company’s ongoing efforts to reduce the protection gap by encouraging more individuals to take the first step towards securing their future.”
Importantly, terminsurance is a financial safety cushion which ensures that an individual’s loved ones are protected even when one is not around. Therefore, it is important to ensure that protection products are made affordable for all.Moreover, the reduced premiums will result in deepening insurance penetration and supporting the goal to instil financial protection into the lives of millions of Indians.