Tax benefits on Life Insurance Policies

The Tax exemption available under our insurance and pension policies are described below:

Under Sec.80C of the Income Tax Act
Premiums paid upto maximum of Rs.1,00,000/-, subject to maximum of 20% of Sum Assured ,to effect or keep in force an insurance on the life of the Individual, the spouse and any child of the individual.

Under Sec.80CCC of the Income Tax Act
Premiums paid upto maximum of Rs. 1,00,000/- to effect or keep in force a contract of annuity plan for receiving pension.

However, u/s.80 CCE, the aggregate amount of deduction under section 80C, section 80CCC, and section 80CCD shall not, in any case exceed Rs. 1 lakh

Under Sec.80 D of the Income Tax Act
Premiums paid (other than through cash) towards Critical Illness Rider, subject to a total maximum of Rs.15,000/- (an additional Rs 5,000 for senior citizens) to effect or keep in force an insurance on the health of the individual, spouse and dependent parents or children.

Maturity Benefits are exempted Under Sec.10(10D) of the Income Tax Act.Maturity benefits are tax free. However in cases where premium exceeds 20% of Sum assured in any year, benefits paid in excess of premiums paid will be taxable.