Irda Mulling To Introduce New Tax saving plans Separately For Fife Insurance Policies

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Irda Mulling To Introduce New Tax saving plans
Separately For Fife Insurance Policies
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• Insurance Regulatory and Development Authority
  (IRDA) is mulling to make insurance policies more
  investor friendly by introducing tax exemptions
  on insurance policies.
• IRDA has backed a move to introduce separate tax
  exemption limit on life insurance policies. This
  move will help in promoting insurance as a tax
  saving instrument.

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• At present, investments in instruments like
  Insurance Policies, Pension Plans, Provident
  Fund, National Saving Certificates are eligible
  for combined deduction of Rs 1 lakh.
• The budget proposed that all Insurance Policies,
  except Pension Plans, would have to offer a cover
  of at least ten times the annual premium to be
  eligible for Tax Benefits under Section 80C and
  Section 10 (10D) of Income Tax Act.
• Insurers say that though insurance policies offer
  low returns in comparison to other products, both
  the regulator and the finance ministry is trying
  to make it more investor-friendly by allowing tax
  saving plans.

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• But insurers say that protection was the first
  goal of an insurance policy and investment came
  later. Hence, investors have to be clear about
  what they want. If investors want pure investment
  then insurance might not be the best bet for
  them.
• But proposal for introducing new tax exemptions
  separately for life insurance policies will
  definitely help in increasing the penetration of
  life insurance in the country.

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