Health Insurance is a good step to be taken in order to protect yourself from the big and heavy expenses that might come in future. In fact, if you see it from the tax benefit purpose, it is very beneficial. But if in case you are a non-residential Indian, and you have taken the health insurance policy in India, will it still help in saving tax?
Yes, you will. Even if you don’t leave in India, and you have taken the policy from here, you are still eligible to have a tax benefit only on the taxable income earned in India.
No matter if you are buying it for yourself or for your other family members, it will be helpful for you. However, if you have bought a policy in India and want to claim it for the medical expenses of any other country, then it won’t work there.
On this, the partner of Deloitte, Aarti Raote said-NRIs are comparatively viewed riskier by insurance companies considering the efforts of collecting facts and ascertaining the authenticity of claims. However, NRIs covering for the health of their parents and family in India through an Indian insurance company is certainly advisable., if an NRI buys a health insurance policy abroad, the policy may cover the treatment in India. However, the payment of premium for that policy will not be eligible for tax-benefit in India.”
NRIs are eligible to claim deduction up to specified limits for health insurance premium paid similar to Indian residents. The deduction can be claimed for the premium paid not only for self but also for parents, spouse and dependent children. However, such deduction is available only in relation to the premium paid towards the health insurance policies which are approved by the Insurance Regulatory and Development Authority of India (IRDAI). Apart from tax considerations, NRI should also consider other practical aspects while buying for a health insurance policy in India such as policy terms in relation to geographical areas covered, foreign exchange management regulations relating to settlement or repatriation of claims etc.” Added by the tax partner, Shalini Jain, people Advisory services, EY, India