Unlock client & item storage free — 26 days remaining

Sign Up Free
GSTInvoice

GST Rates

GST on Insurance Premiums — Life, Health, Motor & General Insurance

GST on insurance services in India is generally 18%, but the calculation varies by policy type. For life insurance, GST applies only to the risk premium component, not the savings/investment portion. For health insurance, 18% GST applies on the full premium. For motor insurance, 18% GST applies on the annual premium.

By Arjun Sharma · GST & Tax Compliance Specialist Reviewed for GST accuracy
No signup required ₹3.60 Cr+ invoice value processed Trusted by 300+ businesses Free forever

Free Tool — No Login Required

Create Insurance Invoice with GST

Auto CGST/SGST/IGST split PDF in 30 seconds No signup needed Free forever
Generate GST Invoice in 30 Seconds
What you get: GST-compliant PDF Shareable invoice link UPI QR on invoice GSTIN validation

GST Rates on Different Insurance Types

Insurance Type GST Rate Notes
Term life insurance 18% On full premium
Traditional life (endowment/money-back) 4.5% (1st year), 2.25% (renewal) On full premium
ULIP (Unit Linked Insurance Plans) 18% On premium excluding fund value
Health/mediclaim insurance 18% On full premium
Motor insurance (own damage) 18% On full premium
Motor third-party insurance 18% On full premium
General insurance (fire, marine, etc.) 18% On full premium
Pradhan Mantri insurance schemes Exempt PMJJBY, PMSBY

Can You Claim ITC on Insurance?

Insurance purchased for business assets is eligible for ITC. For example, fire insurance on a factory, marine insurance on goods in transit, and professional indemnity insurance for a company can all have ITC claimed. However, ITC on health insurance premiums is blocked under Section 17(5)(b)(i) — employers cannot claim ITC on health insurance purchased for employees, even if it is a mandatory workplace benefit. Motor insurance ITC is blocked for personal-use vehicles but claimable for commercial vehicles used for business.

Example

A logistics company pays ₹2,40,000 annual premium for fleet insurance on 10 trucks. GST at 18% = ₹43,200. The company claims ITC of ₹43,200 on its monthly GSTR-3B filing, reducing net GST payable by that amount.

Skip the manual work

Free GST Invoice Generator

Instead of manually formatting invoices in Excel, generate GST-compliant invoices instantly — automatic CGST, SGST & IGST calculation, PDF download, and shareable link.

Generate Free GST Invoice Calculate GST Automatically

FAQs

What is the GST rate on health insurance?

18% GST on the full health/mediclaim insurance premium. A ₹20,000 annual premium will have ₹3,600 GST, making total payment ₹23,600.

Can I claim GST input credit on insurance?

Yes for business asset insurance (fire, marine, commercial vehicle). No for employee health insurance and personal vehicle insurance — ITC is blocked under Section 17(5).

What GST applies to term life insurance?

18% GST on term insurance premiums (pure risk policies). ₹15,000 annual term premium = ₹2,700 GST added.

Is health insurance GST tax deductible?

The GST paid on health insurance premium is included in the total premium for Section 80D deduction purposes, allowing the full premium amount (including GST) as deduction.

Why Businesses Stop Using Excel for GST Invoices

Manual GST calculation mistakes

One wrong CGST/SGST split or a misapplied rate triggers notices and ITC denial for your buyer.

Slow invoice creation

Copying last month's Excel file, updating dates, recalculating — 20 minutes for what should take 30 seconds.

Formatting breaks on every device

Excel invoices look different on every printer and PDF converter. Clients complain about unreadable layouts.

No easy sharing or payment link

Sending PDFs over WhatsApp with no way for clients to pay directly slows down collections.

Incorrect tax type (IGST vs CGST+SGST)

Excel can't auto-detect intra vs inter-state supply. Wrong tax type = ITC rejected for your buyer.

Generate GST Invoice Automatically
Disclaimer: The information in this article is for general informational purposes only and does not constitute professional tax, legal, or financial advice. GST rules and rates are subject to change. Consult a qualified CA or tax professional before making compliance decisions.

Generate Invoice — Free, No Login

Create professional GST invoices instantly — no Excel, no manual calculations.

  • Automatic CGST/SGST/IGST calculation from GSTIN
  • PDF download in under 30 seconds
  • Shareable invoice link — clients pay via UPI QR
  • No signup required — free forever
Generate Invoice Free Calculate GST Automatically Download GST Invoice Format

Want to see it first? View sample GST invoice →

More GST guides

GST on Software & IT Services — Rates, SAC Codes & Invoice Guide

GST Rates

GST on Rent 2026 — 18% on Commercial, 0% on Residential (+ RCM)

GST Rates

GST on Food Services & Restaurants (5% vs 18% — Latest Rates)

GST Rates

GST on Transportation Services — GTA, Courier, Passenger & Freight

GST Rates

GST on Hotel Accommodation 2026 — 12% or 18%? Rate Slab Guide

GST Rates

GST on Advertising Services (18% Rate, SAC Code & Invoice)

GST Rates
Create Free GST Invoice