Insurance relief
(1)
A resident individual who proves that in a year of income- (a)
he has paid a premium for an insurance made by him on his life, or on the life of his wife or of his child*the individual has paid a premium for an insurance made by the individual on the individual’s life or the life of the individual’s spouse or child* and that the insurance secures a capital sum whether or not in conjunction with another benefit and that the insurance is made with an insurance company lawfully carrying on in Kenya the business of life insurance, and that sums payable under the insurance are payable in Kenya in the lawful currency of Kenya: or (Finance Act 2022-wef-01-July-2022) -
(b)
histhe individual’s employer has paid a premium for that insurance on the life, and for the benefit, of that individual which is charged with tax under this Act on that individual; or (Finance Act 2023 wef 1st-July-2023 s19) -
(c)
he, as well as his employerthe individual and the individual’s employer, has paid a premium for the insurance referred to in paragraph (b), (Finance Act 2023 wef 1st-July-2023 s19)
shall, for that year of income, be entitled to a personal
relief in this Act referred to as the insurance relief.
Provided that:-
(i) no insurance relief shall be granted in respect of that part of a premium for an insurance as secures a benefit which may, at the option of the assured, be withdrawn at any time prior to the determination of the insurance, and in that case the proportion of premiums otherwise eligible for relief, if any, shall be the amount that the Commissioner may determine to be just and reasonable.
(ii) no relief shall be granted in respect of a premium for an insurance unless the person claiming the relief furnishes evidence as to the nature and conditions of the insurance and such other particulars as may be required by the Commissioner;
(iii) an education policy with a maturity period of at least ten years shall qualify for relief
(iv) the provisions of this section shall apply only to life or education policies whose term commences on or after the 1st January, 2003.
(v) A health policy whose term commences on or after the 1 January 2007or a contribution made to the National Hospital Insurance Fund*,**shall qualify for relief. (Finance Act 2021- wef-01Jan2022*),(TLAA 2024 wef 27th December, 2024 S11**)
(vi) Where a policy is surrendered before its maturity, all the relief granted to the policyholder shall be recovered from the surrender value of the policy and remitted to the Commissioner by the insurer.
Provided that:-
(i) no insurance relief shall be granted in respect of that part of a premium for an insurance as secures a benefit which may, at the option of the assured, be withdrawn at any time prior to the determination of the insurance, and in that case the proportion of premiums otherwise eligible for relief, if any, shall be the amount that the Commissioner may determine to be just and reasonable.
(ii) no relief shall be granted in respect of a premium for an insurance unless the person claiming the relief furnishes evidence as to the nature and conditions of the insurance and such other particulars as may be required by the Commissioner;
(iii) an education policy with a maturity period of at least ten years shall qualify for relief
(iv) the provisions of this section shall apply only to life or education policies whose term commences on or after the 1st January, 2003.
(v) A health policy whose term commences on or after the 1 January 2007
(vi) Where a policy is surrendered before its maturity, all the relief granted to the policyholder shall be recovered from the surrender value of the policy and remitted to the Commissioner by the insurer.
(2)
In this section “child” means any child of the resident individual and
includes a stepchild, an adopted child and an illegitimate child who was
under the age of eighteen years on the date the premium was paid.31A. Post-retirement medical fund relief
A resident individual who proves that in a year of income the person has contributed to a post-retirement medical fund shall for that year of income be entitled to a personal relief in this Act referred to as the post-retirement medical fund relief. (Finance Act 2023 wef 1st-January-2024 s20)