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A Good Health Insurance Policy

Apollo Munich Easy Health is a good policy that provides the option to pay the premium for 2 years & get a discount on the same

I am planning to buy health insurance through the Apollo Munich Easy Health Standard - Family floater. I am 40 years old and have a wife and two kids. Please confirm if my decision is correct. The policy provides a discount of 7.5 per cent if the premium is paid for 2 years in one payment. But do I get the tax benefit under section 80D for 2 years?
- Jagan Mohan Reddy

Apollo Munich Easy Health is a good policy. Just be sure to fill the form correctly and disclose all relevant information to avoid any problems at time of claim. Apollo Munich provides an option to pay premiums for two years and obtain a 7.5% discount on total premium. However, deduction under Section 80D will be available only for the year in which premium is paid. Which option suits you will depend on the net premium you have to pay under the options. We have made several assumptions to calculate net premiums. The assumptions are:

  1. Your wife is in age range of 18-34 years and your two kids are under 16.
  2. You fall in the 30% tax bracket.
  3. You and your family members are non-smokers and healthy.

Case 1: If you pay two-years' premium in one go and get the benefit of deduction for year 1 only.

(in ₹)
Discounted Total Premium25892
30.9% tax on deduction of Rs.150004635
Net premium after tax21257

Case 2: You pay annual premiums without discount and enjoy deduction for both the years.

      Year 1      Year 2
Total Premium1399613996
30.9% tax on ₹1399643254325
Net premium after tax96719671
Total Premium19342

As it is clear from the example that the second option is more beneficial if you fall in line with these assumptions. You may create an illustration for you in the same manner and see which option works for you.

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