Health insurance or Mediclaim assures that you are adequately covered for all your medical expenses which might arise in the future. The coverage offered by mediclaim policies are different, depending on what kind of a policy you choose. Section 80D also includes preventive health checkup.
Health insurance premia paid by an individual for himself or for his family is deductible. The maximum deduction for a financial year is Rs. 25,000/- (as amended by Budget-2015). However, for senior citizen the deduction is extended to Rs. 30,000/- (as amended by Budget-2015). A separate deduction could also be claimed for premia paid for the health of parents of individual.
In case of HUF, premia paid on the health of any member of that HUF shall also be deductible within such limit.
Note 1- As per the Income Tax Act, cash payment of mediclaim is not allowed.
Note 2- Above ceiling limits includes deduction of payment against preventive health check-up. However, maximum deduction in case of Preventive Health Check-up is Rs. 5,000.
Note 3- In case of very senior citizen of age above 80 years who are ineligible to take health insurance, the expenditure for their health will be allowed U/s. 80D as per the above limits.
Eg. Mr. Pavan, (age 35 years) paid his own health premia Rs. 28,000/-. He also paid health premia of his father (age 65 years) Rs. 32,000/- during financial year 2015-16.
Mr. Pavan can claim a total deduction U/s. 80D of Rs. 55,000/- (Rs. 25,000/- for self +Rs. 30,000/- for his father) for financial year 2015-16.