Revamping India's Insurance and Healthcare: Key Recommendations Ahead of Budget 2025

Ahead of Budget 2025, a State Bank of India report stresses the need for the Indian government to prioritize the insurance and healthcare sectors. Key recommendations include reducing GST and taxes on insurance premiums, enhancing public health spending to 5% of GDP, and streamlining pension schemes under a unified framework.

As India prepares for Budget 2025, a report from the State Bank of India identifies critical areas where government intervention is necessary, specifically in insurance and healthcare. The report urges the Union Government to abolish GST and taxes on term and health insurance premiums and propose separate tax deductions for these essential services.

The SBI report emphasizes alarming declines in insurance penetration, with life insurance reducing to 2.8% and non-life stagnating at 1%. Immediate action is recommended for the government to realign these figures with the Insurance Regulatory and Development Authority of India's (IRDAI) mission of "Insurance for All by 2047."

Moreover, the healthcare sector requires an urgent boost in funding. Despite the National Health Policy 2017's target of 2.5% GDP allocation by 2025, the report suggests increasing this to 5% to effectively meet the demands of a growing and ageing population. These strategic measures are envisioned to solidify India's economic and social foundations.

(With inputs from agencies.)