Budget 2016- What Are The Expectations From The New Budget?

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Budget 2016- What Are The Expectations From The
New Budget?
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• The most
  important economic event of the country is round
  the corner. Yes, we are talking about the annual
  budget that gives direction to the economy of the
  country, that helps the businesses to decide on
  their strategies and that is single-handedly
  responsible for ensuring the growth of the
  country. There are arguments against budget being
  so vital and its relevance should only be to
  discuss governments earnings and expenditures.
  The fact is India is not yet an economy on an
  auto-pilot mode where government can just be the
  facilitator. Here, it is still responsible for
  major policy decisions and steering the economy
  through choppy waters.

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• With so much of responsibility, the expectations
  from the government goes sky high during the
  budget season as it impacts virtually every
  business sector and every citizen of the country
  in numerous ways. From the insurance sectors
  perspective, there are certain expectations from
  the budget of this year as well. Well soon know
  if those are met or not.
• For the moment, lets see what does the insurance
  sector needs the most at this point of time
• 1) FDI In Insurance
• Last year the government had taken some firm
  steps as far as FDI is concerned, but more needs
  to be done as there is a substantial interest in
  the general insurance as well as reinsurance
  sector in the country. Liberalising FDI
  regulations for the sector will bring in more
  investment that can help the sector to grow. This
  in turn can help fuel investments in
  infrastructure and banking sector with insurance
  sector being one of the major investors.

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• 2) Insurance Awareness
• Insurance companies are running huge advertising
  campaigns to make citizens aware of their
  insurance plans and to entice them to buy them.
  However, there are still massive challenges when
  it comes to penetration of insurance deep inside
  the country. Due to low awareness levels, people
  do not invest in insurance products until and
  unless there is a calamity or some personal
  tragedies. In short, insurance is bought more as
  a reaction to a crisis rather than a preventive
  cure. The government needs to run major campaigns
  to raise awareness levels amongst citizens so
  that each and every individual buys either an
  individual or a family plan, even if on a small
  investment basis. A basic Best Investment Plan
  coverage for every individual is the call of the
  day and everyone needs to do their bit to make it
  possible.

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• 3) Tax Benefits In Health Insurance
• There are fixed tax benefits given in the form of
  tax exemptions for every health plan purchased in
  the country. However, the limits are quite low
  and they dont come across as an attractive
  reason for investment. Raising the exemption in
  insurance premium will propel many more people to
  buy health insurance policies. It is an absolute
  must given the medical infrastructure we have as
  health insurance can provide cover to the poorest
  sections of the society. It can also help many
  people avoid going below poverty line in their
  quest for adequate medical treatment.
• 4) Tax Benefits For Home Insurance
• The realty sector is poised for a growth this
  year onwards and many more citizens will be
  moving towards buying their own homes. The
  interest rates are falling and if there can be an
  income tax exemption given to the premium paid
  towards home loans it will give a massive boost
  to sector. Also, it would be a great move if the
  law makes getting home insurance compulsory for a
  basic sum assured. This would work in two ways
  firstly it would get insurance sector tremendous
  business potential and secondly the home buyers
  will feel safe enough to face any unforeseen
  tragedies or natural calamities.

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• 5) Universal Health Schemes
• The government needs to fast track such schemes
  and cover as many states as possible for its
  benefits to trickle down to the grass roots
  level. Social security schemes like providing
  universal insurance coverage etc. have already
  started generating the buzz especially in the
  countryside. The government needs to push these
  harder for every individual to embrace these
  schemes that will directly help the insurance
  sector.

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