Are you thinking about travelling abroad soon? You’ll probably want to get travel insurance, as many countries now require travellers to have it before they go. But the good news is that your trip may be a little easier on your wallet, since experts says travel insurance is GST-exemt. This means that you could end up paying 0 GST on your travel insurance the next time you buy it.
Earlier this month, finance minister Nirmala Sitharaman announced that all individual health and life insurance policies would be exempt from GST starting September 22, 2025. So, from that date, individuals won’t have to pay any GST on premiums for individual health and life insurance policies. However, Group insurance policies will still be taxed at 18% GST.
According to the GST circular dated September 17, 2025, “services of health insurance business provided by an insurer to the insured, where the insured is not a group”, are exempt from paying GST.
Further ahead, the circular defines health insurance business as “health insurance business’ means the effecting of contracts which provide for sickness benefits or medical, surgical or hospital expense benefits, whether in-patient or out-patient, travel cover and personal accident cover;”
While many have seen this GST exemption as only applicable to health and life insurance policies, it is important to understand that travel insurance primarily covers your medical and personal accident expenses up to the sum assured, should you unexpectedly fall ill or injure yourself while on a trip, either within India or abroad. So, does this mean that any travel insurance purchased now will be GST-free? Keep reading to find out more.
What is travel insurance?
Basically, travel medical insurance takes care of any emergency medical costs you may incur while travelling, either within your country or overseas. If you happen to get sick or hurt while travelling, especially in places like the US, Canada or the Schengen area, the medical bills can really add up fast. That’s where travel insurance steps in, allowing you to get cashless treatment if it’s an option, or reimbursing you for your expenses.
According to Naveen Chandra Jha, Managing Director and CEO of SBI General Insurance, the GST exemption on these policies has already been passed on to policyholders. “The net outgo for individual consumers for products like health insurance, personal accident & travel insurance has been reduced, maintaining the same policy coverage & claims servicing standards. The GST exemption applies to new policies, portability, as well as migration cases, enabling individual policyholders, including first-time buyers, to benefit from lower insurance premiums across these categories”.
Even major general insurers such as Tata AIG and HDFC Ergo have already stopped charging GST while purchasing travel insurance from their website. At present, on purchasing international travel insurance plans from their site, the premium breakup does not show GST charges.
Adds Sarita Joshi – Head of Health and Life Insurance, Probus Insurance: “Individuals buying travel cover will also save on GST. However, the complete benefit depends on whether your policy is treated as “individual or family” vs “group.” Earlier, travel insurance carried 18% GST, but post 22 September, premiums for individual/family policies under travel cover are exempt from GST”.
