How Can You Save Tax Using Insurance Policies?

How Can You Save Tax Using Insurance Policies?

Life insurance has become crucial in this fast-paced life. However, as the lifestyle is getting upgraded the income status is improving, the people tend to find tax saving insurance plans that will help them growing their corpus. There are several traditional tax saving instruments are available such as ELSS, PPF etc; but, life insurance offers benefits of both insurance and tax savings. With better tax planning comes a better understanding of tax exemptions, deductions, benefits to minimise tax liability.

Apart from offering financial security in many aspects of your life, insurance policies do come in handy by providing significant benefits like savings on taxes.

Life Insurance

Life insurance policies not only provide life coverage but also make an excellent way to save on taxes. Life Insurance policy work with an individual paying premium every year which in return is received in a large lump-sum amount when the concerned person passes away. The premium paid towards the life insurance policy is liable for tax deduction under section 80C of Income Tax Act. Usually, whole life insurance and term life insurance are the basic life insurance policies that are commonly known to the people.

ULIPs and Endowment Plans

Under this policy, the investors are offered the benefit of both investment and protection under a single plan. Financial investments done under this policy are also eligible for tax deduction. Also, ULIPs provide an opportunity to help your money grow. Similarly, Endowment life insurance plans are traditional investment plans that help you save on taxes.

Health Insurance

As seen in recent years, that the cost of medical care and treatment is increasing rapidly, opting for a health insurance plan seems an optimistic option and also makes for a necessity. A health insurance plan ensures you have sufficient monetary income to take care of your medical expenses. Additionally, if you pay premiums for your health insurance, then you can save up to Rs.15,000 to an average of Rs.20,000.

As they say, ‘’Penny saved, is a penny earned!’’ thus, it’s very crucial for a business owner and an individual to keep track of every transaction appropriately. By opting for the most appropriate tax saving investment plan, you can save a lot, which further helps you achieve the financial goal at the end of the year. Future Generali Total Insurance Solutions gives you a varied list of good life insurance and health plans, which will help you save tax as well as keep you financially secure in an unforeseen circumstance.

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