IRDAI Updates on Life and Health Insurance (Sept 2025 – Nov 2025)
1. Major Tax Relief (Effective September 2025)
The most significant update in this period is related to taxation and policyholder protection.
GST Waiver: The Government announced the removal of Goods and Services Tax (GST) on individual life insurance and individual health insurance policies.
- This move is expected to make these essential insurance products more affordable for the public, encouraging wider adoption.
- Note: This exemption generally applies to individual policies (term life, ULIPs, endowment, family-floater health plans) but Group insurance policies (like employer-sponsored plans) may still attract GST.
2. Focus on Policyholder Protection and Claims
Scrutiny of Health Claim Settlements: The IRDAI Chairman has highlighted a close examination of shortfalls in health insurance claim settlements.
- The concern is that while the number of claims settled is high, the **amount settled in full is often lower than expected, leading to policyholder dissatisfaction.
- Insurers are being urged to focus on prompt, fair, and transparent claim settlement and to strengthen their internal grievance redressal systems.
Proposal for Internal Ombudsman: IRDAI is encouraging insurers to appoint internal ombudsmen to improve accountability and speed up the resolution of policyholder complaints.
Bima Sugam Platform Launch: The launch of the Bima Sugam digital platform has been highlighted as a milestone for the sector. This platform aims to create a comprehensive Digital Public Infrastructure for insurance, promoting transparency and empowering policyholders.
Anti-Fraud Guidelines: IRDAI’s updated guidelines for fighting insurance fraud now include cyber fraud for the first time, requiring insurers and distribution channels to set up fraud monitoring committees and anti-fraud policies.
