Written by : Knowledge Centre Team
Last published : 2026-01-22
6 minutes read
Share
Until recently, Goods and Services Tax (GST) applied to almost every sector and service, including Life Insurance, unless otherwise exempted by the GST Law. For years, policyholders paid 18% GST on their life insurance premiums, which marginally reduced the net returns on investment-linked plans.
However, in a major relief to customers, the 56th GST Council meeting on September 3, 2025, announced the removal of GST on individual life and health insurance premiums, effective September 22, 2025. This means policyholders now pay only the base premium, with zero GST.
What Does This Change Mean for You?
Lower Premium Outgo: The amount you pay is now exactly the base premium, without the earlier 18% GST.
Better Returns: For investment-linked insurance products, the absence of GST improves overall returns, since every rupee goes directly into your policy benefits.
Simpler Payments: You no longer need to account for tax adjustments on premium payments.
Save Taxes While Building Long-Term Wealth
Enter OTP
An OTP has been sent to your mobile number
Didn’t receive OTP?
Application Status
Name
Date of Birth
Plan Name
Status
Unclaimed Amount of the Policyholder as on
Name of the policy holder
Policy No.
Address of the Policyholder as per records
Unclaimed Amount
Sorry ! No records Found
Request Registered
Thank You for submitting the response, will get back with you.
Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.
Impact on Popular Insurance Plans
Let us look at the impact of the new reform on different insurance plans:
Term Insurance Plans
Term plans are pure protection products. Earlier, the entire premium was taxed at 18% GST. For example, if your annual premium was ₹10,000, you paid ₹11,800 including GST.
Now, you pay only ₹10,000, saving you ₹1,800 every year.
Investment-Oriented Plans (ULIPs, Endowment)
Earlier, GST was charged only on the protection part of investment plans, so the tax was lower than term insurance. However, now, with zero GST, your entire premium goes into savings and investments without any tax cut.
Health Insurance Riders
Health riders attached to life insurance policies also benefit from this change, as premiums for these are no longer taxed.
The GST exemption makes insurance more affordable and investment-linked policies more rewarding. Whether you’re securing your family’s future with a term plan or building wealth through ULIPs or endowment policies, you now pay only the actual premium, no extra tax.
Recent Blogs
Income Tax on Family Pension: What You Should Know
07 Aug '26
8 minute read
Understand how family pension is taxed under Indian law, what deductions you can claim, and how to file your income tax return accurately and efficiently.
Read More
Tax Saving
Income Tax Calendar For India: Key Tax Filing Deadlines You Must Know
07 Aug '26
8 minute read
Stay updated with India’s income tax calendar. Know key filing deadlines for FY 2025–26 from ITR, TDS, advance tax, and avoid penalties.
Read More
Tax Saving
Section 80CCD (1B): Deductions Under Section 80CCD of Income Tax Act
06 Aug '26
7 minute read
Learn about tax benefits under Section 80CCD (1B) for NPS contributions, including additional deductions under Section 80CCD(1B) to maximize your savings.
Read More
Tax Saving
Wealth Tax in India: Its Meaning and How Does It Works
06 Aug '26
10 minute read
Explore wealth tax in India, a direct tax on high-value assets. Learn about its abolition and how it worked. Understand its impact with Canara HSBC Life Insurance.
Read More
Tax Saving
E-Filing - File Income Tax Returns (ITR) Online in India 2026
29 July '26
15 minute read
Learn how to file your income tax return online in India with a step-by-step ITR e-filing guide. Understand forms, documents, and the complete process easily.
Read More
Tax Saving
Section 80GG: How to Claim HRA Tax Deduction Without HRA?
29 July '26
10 minute read
Save tax on rent with Section 80GG of Income Tax Act 1961! Learn how to claim deductions, eligibility criteria & how to reduce your tax liability effectively.
Read More
Tax Saving
Section 87A Rebate FY 2026-27: ₹12,500 or ₹25,000?
29 July '26
9 minute read
Check eligibility, income limits & latest tax rebate under Section 87A for old & new tax regimes in FY 2026-27.
Read More
Tax Saving
HUF Taxation Explained: Benefits, Rules & How to Save Tax
29 July '26
7 minute read
Learn how HUF taxation works in India, eligibility rules, tax benefits, deductions, and how Hindu Undivided Families can save income tax legally.
Read More
Tax Saving
What is Income Tax Return (ITR)? Meaning & Filing Process of Filing ITR
24 July '26
10 minute read
Learn what an Income Tax Return (ITR) is, why filing your income tax return is important, and how to file your ITR online via the Income Tax Department. Documents, forms, steps, and FY 2026-27 details included.
Read More
Tax Saving
Tax Savings - Top Selling Plans
We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.
Family Shield: Enhanced Protection
iSelect Smart360 Term Plan
- 3 Plan options
- Life cover till 99 years
- Steady income benefit
- Block your premium at inception
Fixed Returns, Zero Risks & Worries
iSelect Guaranteed Future Plus
- 4 Plan options
- Life cover + Guaranteed benefits
- Accidental death benefit
- Premium protection cover
Start Young, Pay Less, Stay Secured
Young Term Plan
- Life cover till 99 years
- Coverage for spouse
- Block your premium rate
- Covers 40 critical illness
Popular Searches
- Tax Planning
- Income Tax Calculator
- TDS Vs TCS
- Section 80C
- What Is ITR
- Tax Concepts
- Section 80D
- Section 24
- 80DDB
- What is MAT?
- ITR-3 Form
- Term Insurance Tax Benefit
- TDS for Professional Fees
- Income Tax Slab FY 2025-26
- HRA Calculator
- TDS on Rent
- What is Income Tax Return?
- Income Tax for NRI
- How to File Income Tax?
- Section 80C Tax Benefits
- Old vs New Tax Regime
- LTCG Tax on Investments
- Tax Saving Options for Salaried
- Income Tax Rebate under 87A