Insurance is something that is much required for almost everyone in this era, and those who are prone and victims of different diseases can have enough financial protection. The insurance protection is not the only thing that one can have at a specific cost here; it also helps one to save the right amount of tax too. After a certain age, it becomes necessary to have a shield against different diseases, among which a few are also deadly. Those who need to go for the insurance must even know various features of and tax benefits that they can have.
The selection process explained
For an individual, it is necessary to know the right policy for him. The coverage under various situations and cost for the same, as well as conditions for different diseases, one needs to check multiple aspects of the policies. It is vital to note that different policies have distinct features that one needs to check before going for any of them.
- Check coverage: Different insurance companies offer different sum assured as per age as well as the medical condition. The coverage may increase or decrease over a period due to the change in health condition.
- Coverage against different diseases: The insurance is taken to counter the financial loss against various diseases. Different insurance companies cover different diseases, among which few are normal, and a few are fatal. One must know the diseases that are covered under the policy issued to them.
- Other benefits: There are also some more benefits available for those who go for medical insurance. These benefits vary as per the inclusions or add-ons of the policy. Under different conditions, the policies can be offered, and with each of them, the benefits vary.
The tax benefits explained
One can find different types of tax benefits as per the provision of income tax law. While going for the policy and filing the return, these provisions must be considered. Here are some of the benefits mentioned that can help one save the right amount on their spending on health insurance also.
- For self: Those who pay a premium for the self medical insurance, the section 80D can help them save up to 25000ofpremium. It is the maximum deductible amount from the total income.
- For the family: The same provision of section 80D is applied to the premium paid for the insurance of the family members. However, in a family where one of the policyholders is employed and above the age of 18 then it cannot be counted. Female policyholders can be counted even if they are above 18 but not married.
- For parents: If, as a son or daughter, one pays a premium for parents, it can help attract another deduction of 25,000.
- Senior Citizens: It is applicable if they are above the age of 60. It does not matter whether they stay together with the family or not, or if they are dependent or not, in any case,one can have a permissible limit of 50,000 for the annual medical health.
- If the payee of the premium is also a senior citizen and if he pays the medical insurance premium for his parents, he can have exemption up to the amount of 1,00,000 under section 80D of the income tax act.
- Preventive health checks up: Under this category, one can find the exemption to the income tax up to the amount of 5,000. However, here, one needs to note that it is within the prescribed limit of 25,000 mentioned above, and one needs to provide all the proofs for the concerned exemption.
Important points to keep in mind
Many people want to have the benefits of exemption under section 80D, which deals with the premium paid towards health insurance, but most of the customers do not care for some critical points that are mentioned here.
- Always pay from bank account: For the exemption of the amount of premium, you must pay the premium by cheque or any other mode where it can be notified in your bank account. It is not allowed to have a premium exemption if one has paid the premium in cash.
- Check the policy well: Before going for the policy, one must check the diseases and type of coverage as well as limits for the concerned treatment.
- Check the details: The moment the policy is issued, you must check the details of the same and verify them with your documents. In case of any missing orwrong information, you must bring it to the notice of the company and ask them to take necessary actions.
These are some points that can help one get the right medical health policy for self as well as family members and also claim required benefits from the income tax. However, the tax benefits vary from time to time as per the notification of the government, and hence one must check the same with the respective laws at that time.
