From July 1, 2017, the Goods and Services Tax (GST) came into effect and impacts the prices of most products and services. This change is claimed to be the greatest indirect tax modification in independent India. Experts believe that the GST implementation will have positive 
The services sector contributes approximately 60% to the Gross Domestic Product (GDP). Life and general insurance comprise part of the services sector, which will also be impacted under the new tax regime.
General insurance includes health and motor insurance and other non-life policies. Below is how this sector will be affected under GST:
Higher tax
Prior to the implementation of GST, insurance companies levied service tax (ST). The ST rate was 15%, which has now increased under GST. The new rate is 18%, which makes the cost of availing insurance services higher. As a result, if you renew car insurance after the implementation of GST, you will have to pay a higher premium. You will have to pay 3% more on the total outflow.
The impact
Although the overall increase would be nominal, it is applicable to existing as well as new policyholders. For example, assume that the premium on your car insurance policy before GST was INR 11,500 (INR 10,000 Premium + INR 1,500 @ 15% ST). After the implementation of GST, you will now have to pay INR 11,800 towards the insurance policy (INR 10,000 Premium + INR 1,800 @18% GST).
Determining the right policy
The procedure to choose the right car insurance after GST remains the same. You need to research the different products offered by various insurance companies. It is important to check the inclusions and exclusions available under different plans before making your decision. In addition, you must thoroughly understand the terms and conditions of different policies to make an informed decision.
You may research online to compare different products available. Several reliable portals offer beneficial information. It is recommended you review such resources before making your choice. You may also read the reviews and comments written by other users to determine the reliability of the insurance company. Checking the claim settlement ratio is another important thing to do. A higher ratio ensures the company will quickly process your claim if the need arises any time during the policy tenure.
Although a marginal increase is seen in insurance premiums, GST is expected to bring several positive outcomes for the Indian economy. You may feel impacted with a higher premium without any additional coverage or benefit after the implementation of GST. Nonetheless, it is crucial you continue availing of insurance coverage to prevent any financial difficulties in the case of any accidental damage or loss to your vehicle.