Can I get a refund for GST paid in 2024?

No. The zero-tax rule is not retrospective. You cannot claim refunds for GST paid on premiums due before the rule change date.

Does zero GST apply to health insurance too?

Yes. The latest tax update removed GST for both individual life term insurance and individual health insurance premiums.

What if my bank auto-debit still charges the old amount?

You must contact your insurer immediately to update the mandate. They will refund the excess tax via a credit note.

Are term plan riders like Critical Illness also tax-free?

Yes. Riders attached to an individual term insurance policy are now exempt from GST, making comprehensive cover cheaper.

Do I need to submit new documents to get the 0% rate?

Usually no. Insurers update this automatically. However, you should verify your next renewal notice to ensure the tax is Nil.

Why is my office group insurance still charging GST?

The government has kept group insurance under the 18% GST slab. Only individual policies bought by persons enjoy the zero-tax benefit.

GST Refund on Term Insurance: 2026 Guide to Zero-Tax Claims

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GST Refund on Term Insurance: A step-by-step guide to the 2026 Zero-Tax claim

The 18% GST on individual term insurance is finally gone. Here is how to ensure you are not overpaying and how to get your money back if you were.

4 min read

OneAssure Team

March 19, 2026

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Need advice tailored to you?

Looking for the right plan? You don't have to guess. Let us compare the fine print for you and give you an unbiased recommendation.

Your bank SMS just got smaller

Check your phone. Now. Did your recent term insurance premium debit look a bit lighter? It should. The 18% GST that used to eat into your savings is officially history for individual plans. This change kicked in following the landmark GST Council decisions in late 2025. If you are still seeing the old, higher amount on your bank statement, you are essentially giving away free money to the system. It is time to stop that.

The shift from 18% to zero

For years, every time you paid ₹10,000 for life cover, you actually shelled out ₹11,800. That extra ₹1,800 went straight to taxes. Not anymore. Starting from the recent tax updates, the GST rate for individual term insurance has dropped to 0%. This is a massive win for young earners in India. It makes pure protection significantly cheaper. If your premium was ₹20,000, you are now saving ₹3,600 every single year. Over a 30 year policy term, that is over a lakh in savings. That is money you can now put into your SIPs or emergency fund instead of a tax ledger.

How to verify your new premium

Do not just assume your insurer has updated your files. You need to be proactive. Log in to your insurer's customer portal today. Download your latest policy schedule or renewal notice. Look for the tax breakup section. It should clearly state GST as 0% or Nil. If you see 18% listed there for a payment due in 2026, your insurer's system might be lagging. A quick check now prevents a long headache later. Most tech-forward distributors like OneAssure have already updated their platforms to show these revised, tax-free prices for new buyers.

What if you were overcharged?

Mistakes happen. Systems glitch. If your bank auto-debit went through with the old 18% GST included, you are entitled to a refund. Here is the step-by-step process to get your money back:

Step 1: Get your proof. Download the premium receipt that shows the 18% tax was charged after the rule change date.
Step 2: Email support. Send a formal email to your insurance company's customer service. Mention your policy number and the specific transaction date.
Step 3: Request a Credit Note. Insurers usually process these refunds by issuing a credit note or direct bank transfer. Specifically ask for the 'GST Refund' due to the zero-tax notification.
Step 4: Update your mandate. If you use E-NACH or standing instructions, cancel the old mandate and set up a new one with the lower premium amount to prevent this from happening again next year.

The NRI advantage: Getting that 18% back

Non-Resident Indians have a unique path here. If you are an NRI paying for an Indian term plan, you can still claim a GST refund if you use an NRE account. Since the service is technically an 'export,' you are eligible for a tax waiver. You will need to provide your Tax Residency Certificate (TRC) and a copy of your passport. Ensure your foreign address is updated on the policy. Without that foreign address proof, the insurer will treat you as a resident and might not process the specific NRI tax benefits.

The Group Insurance trap

Got a term plan from your office? Check your salary slip. You might still see a tax component there. Why? Because the zero-tax rule applies only to individual plans. Group term insurance policies, which companies buy for their employees, still carry the 18% GST burden. This is one reason why having your own personal, tax-free term plan is now even more financially sound than relying solely on your employer's cover.

Riders and the Free-Look period

What about your accidental death or disability cover? Good news. If these riders are part of your individual term policy, they also fall under the zero-tax slab. However, if you decide to cancel a new policy within the 15 day free-look period, the insurer must refund the entire amount. Since there is no GST anymore, you should get back every single rupee of the premium you paid, minus only the medical exam costs and stamp duty.