As per the Finance Bill, effective 2012, for a life insurance policy to get full tax benefit, the minimum death benefit throughout the policy term has to be at least 10 times the premium paid in a year. As long as your policy conforms to this, you can avail of tax benefit under Section 80(c) for premiums paid and under Section 10(10D) for maturity proceeds. Death benefit is always tax-free.
Can I club a personal accident cover with a endowment
Accidental death or disability benefit riders can be attached to an endowment plan. Check with your insurer on availability of the same with the plan you have chosen.
How do I go for an annuity if I want to invest my PPF accumulated funds
Yes, you can do that. It will be similar to purchasing any new policy. You could get in touch with the insurance agent or visit any branch and ask for an immediate annuity plan. Some companies offer immediate annuity online as well. This option may work out slightly cheaper.
If I have to look for a long-term child policy for my sons education, which covers both risk and investment, can I go for a unit-linked insurance plan (Ulip) that has a mix of debt and equity
Yes, you can, as Ulips will be able to give good returns over long term and you will also have the flexibility to change your equity-debt exposure, as per your requirement from time to time.
I am getting repeated calls from a telemarketing company offering 80% discount on first-year premium for an endowment policy. It sound lucrative. Should I go ahead and make the online payment
Such calls are spurious. No insurance company, its agents or representatives are allowed to offer such discount on premiums as per the regulatory framework and its a punishable offence under Section 41 of Insurance Act, 1938.
Can I get tax benefit on a single-premium policy and how much return can I expect from such a policy after maturity
Yes, you can avail tax benefit under Section 80C in the year of purchase and under Section 10 (10D) at maturity, assuming that the minimum death benefit throughout the policy term remains 10 times the single premium paid, in case of life insurance policies issued on or after April 1, 2012. There are single-premium plans in both unit-linked and traditional platforms and the maturity returns will depend on the platform as well as the specific investment philosophy of the product.
* The author is executive vice-president, Kotak Mahindra Old Mutual Life Insurance
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