What Are the Tax Benefits of Health Insurance?
The tax5 benefits of health insurance can be availed under Section 80D of the Income Tax Act 1961 on your annual premium payments. You can also get additional deductions under Section 80DDB for the medical treatment for yourself or for a dependent. The law defines dependents as your spouse, children, parents, sisters, and brothers.
The 80DDB deductions relate to medical expenses for treating specified diseases or ailments as may be specified in rule 11DD and should not be confused with the premium payments on health insurance bought to cover such diseases. Remember, the premium payments for health insurance are covered under Section 80D of the Income Tax Act.
Individuals and HUFs can claim both of these deductions. The deductions for Section 80DDB are taken out of the pre-medical expenses for treating specified diseases. They are deducted from the Gross Total Income while computing the individual's taxable income.
Health Insurance Tax Deductions Under Section 80D |
Covered Individuals |
Maximum Deduction |
Preventive Health Check-Up Deduction Limit |
Total Tax Deduction Under Section 80D |
Self, spouse, and dependent children |
₹25,000 |
₹5,000 |
₹25,000 |
For self and family, including parents (all under 60 years) |
₹25,000 + ₹25,000 |
₹5,000 |
₹50,000 |
For self, family including senior citizen parents (over 60 years) |
₹25,000 + ₹50,000 |
₹5,000 |
₹75,000 |
For self and family, including parents (all above 60 years) |
₹50,000 + ₹50,000 |
₹5,000 |
₹1 Lakh |
Health Insurance Tax Deductions Under Section 80DDB |
Age of the Person Receiving Medical Treatment |
Deductible Amount |
Under 60 years |
Maximum ₹40,000 or the amount paid, whichever is less. |
Senior Citizens (60 years and above) |
Maximum ₹1,00,000 or the amount paid, whichever is less. |
Super Senior Citizens (80 years and above) |
Maximum ₹1,00,000 or the amount paid, whichever is less. |
Mode of Payment u/s 80D
Payment Purpose |
Payment Mode |
Preventive health check-up |
Any mode (including cash) |
All other cases (except check-up) |
Any mode (excluding cash) Cash payments not allowed as deduction |