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The point of getting insurance is that it gives you mental peace. Insurance is a legally obligatory agreement between the insurer and the insured that promises the insured to receive compensation under the specified circumstances. The agenda of this insurance is to ensure you and your loved ones are protected.
There are several types of Health insurance policies and they can be customized to your needs. You can opt for an individual health insurance policy or a family floater plan. There are many packages that are based on the age of the insured. And the benefits of those packages are available accordingly.
Also read – 9 Things To Know About Car Insurance
The premium depends on the policy picked by you. An individual policy will cost less than a policy that offers coverage for dependents. If you have customized the package by choosing add-ons, each add-on will add to the amount of the premium.
Adding OPD for the younger lot, while the young couple or families get the advantage of a maternity cover. The older ones get benefits that are suited to them, such as coverage for alternate treatments like AYUSH.
A good Health insurance policy not only protects against unfortunate incidents but also contributes to financial planning. As per the Income Tax Act, you can claim the premium you pay as a deduction from your income tax. Paying health insurance premiums for your family and yourself, with dependent senior parents, makes you qualified for tax removal up to a maximum of one lakh rupees.
Sections Of The Income Tax Where Medical Insurance Benefits Can Be Claimed
The tax benefits of medical insurance are high and they form a big part of your limit of the tax amount you can save.
Section 80D –
As per section 80D of the Income Tax Act, health insurance tax benefits are extended to the taxpayer on premium paid towards health insurance for self, spouse, dependent parents, and dependent children. The sibling is not covered under this section.
Taxpayers can claim a maximum deduction of 25,000 rupees against health premiums paid for self, spouse, and dependent children. You can claim a maximum deduction of up to 50, 000 rupees if the medical insurance policy includes dependent parents below 60 years of age. If parents are above 60 years of age, then 75, 000 rupees can be claimed in total.
If an individual is above 60 years of age and makes the payment of premium for self, spouse, dependent children, and dependent parents who are also above 60 years of age, 1 lakh rupees can be claimed as a deduction.
Section 80DD –
As per section 80DD of the Income Tax Act, the tax deduction is granted for a dependent who is differently abled and is completely dependent on the taxpayer for support & maintenance. The deduction is allowed for a dependent on the taxpayer and not the taxpayer himself/herself. It is also applicable if the taxpayer has incurred expenses towards medical treatment, training, or rehabilitation of the differently-abled dependent. As per this section, if the taxpayer has invested in a scheme or insurance policy for maintenance of the differently-abled person, it is eligible for a tax deduction.
A deduction up to a maximum of 75,000 rupees will be granted under the section. The maximum deduction limit increases to 1.25 lakh rupees in the cases of severe disability. If you are wondering what severe disability is, it means the disability percentage is 80% or more.
Section 80DDB –
Under Section 80DDB of the Income Tax Act, 1961, taxpayers can claim a deduction for medical treatment of certain specified ailments for self or dependents. Dependants can include spouse, parent, sibling, or any dependent family member.
The taxpayer is eligible for a tax deduction of 40,000 rupees or the actual amount paid, whichever is lower. Senior citizens between the ages of 60 to 80 years are eligible for a deduction of 60,000 rupees. Senior citizens above the age of 80 years are eligible for a deduction of 80,000 rupees.
There is a list of ailments mentioned in this section that are taken into consideration when seeking tax benefits.
How Much Tax Benefit Can You Get On Health Insurance?
|Self and Family (All members below 60 years||25,000 rupees|
|For Self and Family + Parents (All members below 60 years)||25,000 rupees + 25,000 rupees|
|For Self and Family (all members below 60 years) + Senior Citizen Parents||25,000 rupees + 50,000 rupees|
|For Self and Family (with eldest member above 60 years) + Senior Citizen Parents||50,000 rupees+ 50,000 rupees|