Life Insurance Premium deductible under section 80c
Life Insurance Premium is paid by almost everyone. There are people who pay it for tax benefits and there are those who are solely interested in the life risk cover. Whichever category you are in, this article will help you getting an insight about the tax provisions related to life insurance premium payment eligible for deduction under section 80c.
Life insurance premium paid towards life insurance policy by an individual will be eligible for deduction under section 80c only when such premium is paid by the individual towards his own life insurance policy or to keep in force the life insurance policy of the spouse or the children. Life insurance premium paid for the life insurance policy of parents or siblings is not allowed as deduction under section 80c. Even if the parents are dependent on the individual the premium paid does not qualify for deduction under section 80c.
Deduction for the payment of life insurance premium is also available to HUF but only for the premium paid to keep in force the life insurance policy of the members of the HUF.
Another provision that the included by the finance Act 2012 under section 80c was that the premium paid towards life insurance should not exceed 20% of the capital sum assured during the financial year.
Most individuals only think that life insurance is synonym with LIC but it is not so. One can buy life insurance products from other private banks as well like icici bank, kotak etc.
There are various plans available in the market for life insurance therefore one must fully understand his requirement on the basis of his premium paying capacity, life insurance cover needed, tax benefit arising etc before finalizing the life insurance plan. For more information on this you can visit the LIC website