Gurugram: Policybazaar, a leading online insurance platform in India, has seen unprecedented traffic for health and term insurance in response to the Government’s significant announcement of a 0% GST. The current demand surge from the pre-GST baseline (up to September 2025) has outstripped the increases observed during the pandemic. This underscores the immediate effect the policy change has had on the pure protection segments. Term insurance has experienced a remarkable 2.5x increase since the implementation of the no-GST rule, while health insurance demand has surged by 2.2x. The momentum has continued, with health insurance demand now up 1.7x and term insurance up 1.8x on the platform. Historically, insurance penetration in India has been low compared to global standards.
The government’s groundbreaking decision to eliminate GST on term and health insurance is expected to boost the uptake of these essential products, which are vital for financial protection for families in India. Sarbvir Singh, Joint Group CEO of PB Fintech, commented on this development, stating, “The biggest win for us and the industry is that this announcement has successfully converted latent demand into active interest. In India, where financial shocks can deplete years of savings, this timely move promises to bolster the resilience of households. We express our gratitude to the Government and PM Modi for conveying the clear message that health and life insurance are crucial for the economy and are now GST exempt.
This progressive reform reassures countless families and empowers the industry to expand its reach in India with confidence.” Policybazaar’s strategy has centered around addressing the social security requirements of India’s middle class. Notably, 85% of the brand’s marketing efforts have focused on educating consumers about term and health insurance. The insurance market typically includes three consumer segments: active buyers, procrastinators, and fence-sitters. For active planners, this is an ideal time to enhance coverage. Procrastinators are now prompted to make overdue purchases due to the reduced costs. Meanwhile, fence-sitters are finding the GST relief to be a compelling incentive to proceed with their purchases. Additionally, the timing of the announcement aligns with cultural factors.
Navratri, regarded as an auspicious period for new beginnings and investments, has further spurred consumer engagement with these products. The festive season generally stimulates financial decisions and significant purchases, and this year, the GST relief has intensified that momentum.