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For most individuals in India, health insurance is much more than a protection cover. Although it plays a vital role in helping you to cope with ever escalating medical prices, it has also become an important part of your financial portfolio.
Most financial experts suggest that having an adequate health cover is an important step in building any financial portfolio. Wondering how? Read on:
Apart from providing you with a financial cover at the time of medical emergency, a standard health insurance policy also helps in reducing your income tax liability to a great extent. To help you make the most of the tax benefits associated with your health insurance policy, we have listed down a few ways.
Savings on premium:
Section 80D of Indian income tax act allows you to avail certain deductions on the basis of premiums you pay.
Tax exemption of Rs 25,000 is allowed on account of the premium you paid for health insurance cover. The deduction can be claimed if the coverage is availed by you, your spouse, or your dependent children. There is an additional Rs25,000 available for the premium paid by you for your dependent parents. If any of them are over the age of 60, then an additional Rs5,000 is available for them. So in all you can avail a tax exemption of up to Rs55,000/- for your family.
• To avail tax benefit on health insurance cover, it is important that you pay premium through banks, no deduction is given on the cash payment.