# Insurance Services - GST Exemptions

## Life Insurance Exemptions

Life insurance services under National Pension System (NPS) → EXEMPT
Life insurance services to members of:
Army, Navy, Air Force, Coast Guard personnel
Central Armed Police Forces

→ EXEMPT

Life Micro Insurance product with sum assured up to ₹2,00,000 (IRDAI approved) → EXEMPT

## Other Exempt Insurance/Pension Services

ESI, EPF, NPS Trust → EXEMPT
Coal Mines Provident Fund → EXEMPT
General Insurance services and Re-insurance services specified by Government → EXEMPT
Insurance services provided by Motor Vehicle Accident Fund → EXEMPT
Contribution under Atal Pension Yojana → EXEMPT
Pension scheme under Section 80CCD → EXEMPT

## Amendment - Life/Health/Re-insurance (Latest)

Type	Individual	Group/Other
Life Insurance	EXEMPT	TAXABLE
Health Insurance	EXEMPT	TAXABLE
Re-insurance of above	EXEMPT	TAXABLE

Worked example

### Example 1

Example 1: An army officer pays a premium of ₹50,000 for life insurance under the special policy for armed forces personnel.

Answer: Life insurance services to members of the Armed Forces (Army, Navy, Air Force) are EXEMPT from GST.

### Example 2

Example 2: A retail customer takes an individual health insurance policy from ABC Insurance Co.

Answer: As per the recent amendment, individual health insurance is now EXEMPT from GST.

### Example 3

Example 3: A company purchases a group life insurance policy for its 500 employees.

Answer: Group life insurance is TAXABLE under GST (only individual life insurance qualifies for exemption).

⚠️ Common exam mistakes

Confusing 'individual' and 'group' insurance - exemption applies to individual policies only after the amendment.
Thinking all government-backed insurance is exempt - only specific schemes (NPS, ESI, EPF, etc.) qualify.
Forgetting that re-insurance of exempt insurance is also exempt (and follows same individual/group rule).
Treating Atal Pension Yojana contributions as taxable - they are exempt.

Bare-Act text Entries 26A, 28, 29 · Notification No. 12/2017-Central Tax (Rate) · click to expand

Services of life insurance business provided by Army/Navy/Air Force Group Insurance Funds to members of the Army, Navy and Air Force respectively, under the Group Insurance Schemes of the Central Government.

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.

🔥 Drill 5 Qs on this → ✍️ Adaptive practice →

GST Exemptions - Insurance Services

Worked example

⚠️ Common exam mistakes