“ Take Immediate Action To Strengthen Insurance Sector": PV Abdul Wahab MP

Indian Union Muslim League (IUML) MP PV Abdul Wahab today urged the Ministry of Finance in the Rajya Sabha to take immediate action to strengthen the insurance sector and public sector general insurance companies. In his special mention submission, he stated that the Indian insurance sector, particularly public sector general insurance companies, faces significant challenges that require immediate government attention. To ensure a robust insurance landscape that benefits both citizens and public sector companies, he urged the Ministry of Finance to consider critical recommendations.

Firstly, he advocated for the elimination of GST on life and medical insurance premiums. The current 18% GST on these premiums is unreasonable and discourages individuals from securing essential financial protection and this recommendation, according to Wahab, aligns with the Parliamentary Standing Committee on Finance’s suggestion, prioritising both public needs and industry growth.

Secondly, he called for the reintroduction of the tax deduction for health insurance premiums. The new tax regime’s removal of the income tax deduction for health insurance premiums under Section 80(D) undermines its affordability. With rising healthcare costs, reintroducing this deduction, as allowed under the old regime, is crucial to ensure broader access to health insurance.

Lastly, he recommended consolidating public sector general insurance companies. Public sector general insurance companies like National Insurance, New India Assurance, Oriental Insurance, and United India Insurance consistently demonstrate strong performance despite challenges. They hold a significant market share exceeding 30%. Merging these companies into a single entity can unlock economies of scale, enhancing their efficiency and competitiveness.