GST on insurance
GST received on insurance payout is lieu of comepensation/loss/expenditure is actually your income. If you receive an insurance payment relating to your taxable activity, you must include the GST content as an adjustment in Box 9 of the return covering the time you received the payment. (It is part of collected GST)
Some types of insurance premiums are liable for GST (such as fire and general insurance). A registered insurer may claim deductions for payments to policy holders when they are made. A tax invoice is not needed.
The insurer needs a tax invoice to deduct any other payments for claims on policies, such as a payment to a panelbeater for repairs to an insured vehicle.
An insurer cannot claim for payments made under life insurance policies.