Monday, February 22, 2010

Rakesh Jain, Director-Corporate Centre & CFO, ICICI Lombard GIC

The General Insurance industry is in a developing phase with significant scope for penetration. Tax rate for unrealized gains for General Insurance companies should be at par with the applicable taxes to the other industries, which will act as a catalyst to the growth and penetration of the industry. In an attempt to boost investment in infrastructure and social sector by insurance companies, income arising from such investments be made tax exempt. Although India is a country vulnerable to natural disasters, less than 1% of homes in India are insured. Premiums paid for home insurance should be made tax deductible upto Rs 10,000 which would help fuel the penetration of home insurance in India. Further rural/micro insurance policies also be granted service tax exemption in view of the target population for such policies who are basically from the rural and social sectors thus increasing their affordability. Currently, policies with premium of less than Rs 50 are exempt from service tax. The said threshold limit set in the year 1994 needs to be revised to at least Rs 1,000. The General Insurance industry also expects a circular exempting tax deducted at source (TDS) on payments made to foreign reinsurance and consequently a rise in premiums charged to the customers.

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Mr. Rakesh Jain joined ICICI Lombard in 2001 and is the Director Corporate Centre and CFO Head Marketing and E Channel of the company. He joined the risk Management department of ICICI in 1998, prior to which he was working with ITC classic. An alumini of St. Xavier’s College of Commerce, Kolkata, he also holds ICWA and CA degrees.

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