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Scenarios in which you will not be eligible to claim tax benefits on your health insurance policy

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While getting tax benefits can be a great motivation to buy health insurance, you need to be aware that there are certain situations in which you will not be able to claim any benefits even if you have paid the due premium. As per section 80D of the Income Tax Act, the maximum limit of tax deduction that you can claim is Rs 25,000 for individuals, and for senior citizens, this limit is Rs 50,000. However, if you read the terms and conditions carefully, you will come across at least five situations in which you will not be eligible to claim tax benefits on health insurance. They are as follows:

A one-time premium paid on a multi-year policy

Nowadays, most insurance companies are offering health insurance policies spanning two or more years. If you buy such a policy which is valid for more than a year and pay the premium in a lump sum, you will be eligible to claim tax benefits only for the assessment year in which you paid the health insurance premium. So, even though your policy may be valid for the subsequent years, you will be paying no premium and therefore you will not get any income tax deductions for the subsequent years.

Paying health insurance premium for someone who is not dependent on you

You can claim tax benefits only on health insurance policies taken for yourself, your spouse, and dependent children and parents. Therefore, if you pay the health insurance premium for anyone other than those specified, you will not be eligible to claim any income tax rebate on it.

No proof of premium payment, no benefits

During the course of the assessment year, you will have to submit proof of premium paid on health insurance policies to your employers to be eligible to claim income tax deductions. If you fail to do so, you will not be able to claim the benefits which you are eligible to under section 80D of the Income Tax Act.

Premium paid for financially independent children is not eligible for tax benefits

If you are under the impression that you can claim tax sops for the health insurance policy of your independent children, you would be in for a shock. You can claim the tax benefit u/s 80D only as long as the child is dependent on you.

If you do not renew your health insurance plan on time

A majority of health insurance plans have a validity of one year and have to be renewed on or before the last date, failing which you will not be eligible to claim the tax benefits of health insurance. If you are planning to buy medical insurance for yourself, your spouse or parents, do go through the health insurance plans offered by Bharti AXA as they have some very comprehensive plans at very competitive premiums rates.

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Disclaimer : The information published on this website is for the public's reference only. Content of this information is to provide an overview of your Travel needs and should not be relied upon for personal, medical, legal or financial decisions and you should consult an appropriate professional for specific advice. Bharti AXA General Insurance Company Limited makes no representations about the suitability, reliability, timeliness, and accuracy of the information, travel, services, or any other items mentioned on this subject for any purpose whatsoever.

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