Apr 032013


A  Mediclaim policy is one that refers to the medical insurance of individual, HUF, spouse, parents or dependent children, also known as health insurance .The section 80D of Income Tax Act provides for deduction of the payment made subject to the premiums of such medical policies. This exemption is over and above the deductions of Rs.1,00,000 under the section 80C. Medical insurance is vital in order to insure the health and safety of the family members, and it comes to aid in times of illness and makes up for your medical expenditure.

The medical premium varies with age, and as you grow older the premium increases.(Hence it is recommended that a senior citizen gets himself medically insured) The insurance can take place at any point of time between the age span of 18-59 yrs. As per the budget 2011-12, a senior citizen is a person of the age 60yrs or more. Before that, 65 yrs and more was considered as the age for senior citizens) the policy can be in the name of any of the following persons:

Individual or the taxpayer

Parents: Parents of the individual and of the spouse may be covered under this irrespective of their dependence on the assessee.

Dependent children: legitimate children or legally adopted children fall under this category and may be insured by the taxpayer. This includes male child who is unemployed, under the age of 25 yrs and he is a bonafide student fully dependent on the assessee . In case of a girl child, she is considered d as dependent until she is unmarried.

And in case of an HUF, any family member can be insured.

The total amount of deduction included under the section 80d mediclaim policies is Rs.35000. It is split into parts as shown below:

For an individual:

Basic deduction: The insurance premium of self, spouse and children is covered under this amount. Maximum deduction upto Rs.15000 is allowed .however, a deduction upto Rs.20000 is allowed in case the insured person is a senior citizen.

Additional deduction: Includes the medical premium paid for parents and a maximum deduction upto Rs.15000 is allowed. If the parent in this regard is a senior citizen then the amount is increased upto Rs.20000.

For HUF:

The premium can be paid for any member of HUF and the maximum deduction of Rs.15000 is permissible. Only when the person is a senior citizen the amount available for deduction is Rs.20000.

The medical premium is paid under medical insurance scheme of General Insurance Corporation approved by the Central Government or by any other insurer approved by IRDA (Insurance Regulatory and Development Authority).. Before 1st April 2009, the only mode of payment allowed was cheque. The payments for such premiums can now be made via any mode other than cash.