Making Travel and Car Insurance Tax Friendly

Insurance policies have seen an immense increase in popularity. Their importance and usefulness has dawned on people such that many people are sure to invest in it. Motor insurance, in India, is compulsory. Hence almost everyone who owns a vehicle has invested in it. Due to the immense investments these insurance policies get, it has sparked a new debate. Should such policies be made more tax friendly? Life insurance and health insurance policies have been exempted from taxation in order to encourage people to invest in them. However, these policies which are increasing in popularity, are also extremely expensive, and need to be encouraged as well.

Over the last few years, technology has advanced in leaps and bounds. There has been a great improvement in the automobile industry. Although a relatively small portion of the Indian population owns a car, the percentage is slowly increasing. At the same time, a far larger portion of the population owns at least some sort of vehicle. Many who cannot afford a car own vehicles such as a scooter, a motorcycle, etc. 

With the growing of the Indian middle class and the relatively affordable travel fare, travelling has become easier. More and more people have begun roaming the world. This calls for an increased demand for travel insurance. This is because no event is devoid of blunders. Luggage can be lost, flights and trains missed, accidents are not unheard of. Unfortunately, not everyone is able to afford this along with their travel expenses. Travelling internationally can be especially expensive and international travel insurance even more so.

On the other hand, car insurance is one of the more popular insurance policies opted for in India. This is because it is mandatory. Anyone who owns a car needs an insurance policy on it. As a result, buying a car incurs multiple other costs along with it. Its insurance policies are extremely costly and can dissuade people from buying a car altogether. In 2007, less than 1% of India's population owned a car. Yet, the rapid increase in the car owning population shows the increased investment in this insurance policy. This can be seen as 4.7% of India's population owned a car/jeep/van in 2013.

Today, as we stress on advancement, we must also look to the people. We need to discover better ways to aid them. Investing in motor insurance and international travel insurance is often the deterrence needed for putting people off of buying vehicles or travelling internationally. As a result, in order to facilitate the growth of such policies, it is important to make them more advantageous.

For why would people invest in an extremely expensive travel insurance policy? It is true that blunders are not unheard of, but they are not extremely common either. Many may consider it a waste of money. But there would also be some among these who have repented this decision. Almost everything in most places abroad, ranging from hotel stay to public transport, is more expensive.

Hence, in order to encourage people to spend on such useful policies, we need to make an effort. Making such policies tax friendly allows people to discern their advantages. The hesitation they suffer in the expense can be avoided in the advantages the policy proposes. This would be for the benefit of the people themselves as such policies offer a valuable back up.

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