How to Buy Health Insurance and Maximise Savings with Section 80D Deductions?

Medical emergencies can arise anytime. Thus, maintaining the cost and quality of healthcare, and safeguarding your health is of utmost importance. To overcome unforeseen medical expenses, investing in health insurance is an ideal investment. To encourage buying health insurance plans, the government offers several tax benefits under Section 80D of the Income Tax Act, reducing the overall payable amount.

Continue reading this blog to learn what is Section 80D of the Income Tax Act, how to maximise tax savings, and more.

What Is Section 80D of the Income Tax Act?

Section 80D of the Income Tax Act allows for tax deductions of up to Rs. 25,000 for premiums paid in any particular financial year. This is however applicable for individuals and Hindu Undivided Families. For senior citizens aged 60 years and above, Section 80D offers up to Rs. 50,000 on health insurance premiums. In all, taxpayers can claim around Rs. 1 Lakh deductions under this Income Tax Act.

Thus, with the purchase of a health insurance policy, individual policyholders can enjoy tax benefits for spouses, parents, and also dependent children. The main reason behind purchasing a health insurance plan is to secure themselves and their respective family members from any emergency medical crisis.

Tax Deductions Allowed Under Section 80D

The table below displays the different categories of deductions available for an individual taxpayer for any particular financial year under different situations:

Category	Eligible Individuals	Maximum Amount Deductions
Individuals and Families	Spouse, Self, and Dependent Children	Rs. 25,000
	Parents (Below 60 Years)	Additional Rs. 25,000
	Senior Citizen Parents (60 Years and Above)	Additional Rs. 50,000
Hindi Undivided Families (HUFs)	HUF members including the spouse, head member, parents, and dependent children	As per the members meeting the eligibility criteria in the HUF

How to Maximise Tax Savings?

Choosing the right insurance plan is essential. Let’s explore some important tips on how you can maximise tax savings through health insurance policies:

● Go for Family Floater Plans

Opting for a family floater plan will let you include your family members under a single plan. Not only these but with a family floater plan, you can enjoy high coverage with low premiums, ensuring maximum tax savings.

● Choose Top-Up Plans

The existing health insurance policy can be upgraded with top-up plans. With top-up plans, extra coverage is provided above the deduction limit, offering maximum benefits.

● Proper Evaluation of Premiums and Policies

Before buying any health insurance plan, make sure to evaluate it considering its features, premiums, and coverage. To choose the right one, exploring its tax benefits is a must.

● Insurance Plan for Senior Citizens

For senior citizens, it is advisable to buy health insurance separately. This not only provides the senior people financial security but also offers tax deductions because the limit rises for them.

● Avail Coverage for Health Check-ups

For early detection of any diseases at an initial stage, make sure to go for regular check-ups. So, avail the additional deductions and remain motivated to stay fit and healthy.

Bottom Line

To conclude, with the rising cost and quality of treatment and methods, investing in health insurance is mandatory. Health insurance not only provides financial protection against medical emergencies but also lets you lead a healthy lifestyle.

Understanding the importance of Section 80D will let you reach an informed decision making while choosing the appropriate health insurance plan and maximising tax savings. Irrespective of whether you belong to part of a HUF or an individual, you can avail of tax exemptions through investment in comprehensive health coverage.

Insurance