Star Health and Allied Insurance is considering diversifying into general insurance products even before securing a composite licence, according to reports by ET Now. The company believes this move could help offset potential losses from Input Tax Credit (ITC), which currently stands at around 3.8%.
With the Goods and Services Tax (GST) on health insurance potentially moving to nil, Star Health fears losing maximum ITC benefits. To mitigate this, the insurer is reportedly evaluating expansion into segments such as motor, home, and term life insurance.
Currently, Star Health operates as a Standalone Health Insurance Company (SAHI), though it already holds a general insurance licence. Nearly 90% of its business comes from the retail health segment, leaving limited diversification.
The company’s earlier plans included broader coverage post-composite licence approval, but the ITC scenario may accelerate its strategy. As of now, Star Health has not publicly responded to ET Now’s queries on the matter.
