Insurance Sector Seeks GST Relief; SBI Life Stock Trades Near Resistance Zone

The insurance industry in India is engaged in discussions with the government over reducing the Goods and Services Tax (GST) on commissions and distribution costs, a move that could ease pressure on companies such as SBI Life Insurance. 

Acquisition costs remain among the highest expenses for insurers, and a cut in GST would directly reduce operating costs.

SEBI-registered analyst Mayank Singh Chandel said commissions and distribution form a large portion of an insurance company’s expenses, and a reduction in GST could lower operating costs. 

He noted that lower costs may even enable insurers to offer more affordable policies to customers.

Insurance GST Breakdown

The government has confirmed that people will no longer have to pay GST on premiums for individual life and health insurance policies, a move that makes coverage cheaper and easier to afford for individuals and families. However, no input tax credit (ITC) is allowed for commissions, brokerage, or administrative services.

According to industry estimates, the impact of GST on bottom lines could be around 6–7% for non-life insurance companies on average, with the effect likely to be higher for firms that carry a greater proportion of health insurance in their portfolios.

Chandel added that the sector is under pressure as competition grows and efficiency has become critical. By cutting costs, companies could sharpen pricing and potentially expand more quickly.

SBI Life Technical View

On SBI Life, Chandel said the stock is moving sideways near its all-time high, with a resistance zone between ₹1,800 and ₹1,930.

He explained that the stock remains above its 200-day Exponential Moving Average (EMA), indicating a positive long-term trend. The 50-day EMA and 21-day EMA are closely aligned, indicating a current consolidation phase.

Relative Strength Index (RSI) is around 48, signaling neutral momentum.

Chandel advised investors to consider a small entry at current levels and add more if the stock breaks out above the resistance zone.

What Is The Retail Mood?

On Stocktwits, retail sentiment was ‘neutral’ amid ‘normal’ message volume.

SBI Life’s stock has risen 29.3% so far in 2025.

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