I recently read that, currently, there are no pension plans from insurance companies. I was planning to take a policy for saving tax. What should I do?
?Ramandeep Singla
Several insurers are recalibrating pension products (categorised as products that have the mandatory annuitisation feature) in their portfolio to conform to new Irda guidelines. That said, you can save taxes by purchasing any life insurance plan. Under current laws, you can avail tax breaks on premiums paid in a financial year up to a ceiling of 20% of sum assured within the overall eligibility of Section 80C.
How do I take a loan against my insurance policy?
?Jyoti Sen
A loan against a policy is basically an advance against its value as on that date, which is determined by the surrender value, and could go up to 90% of this value. However, the terms, conditions and limit of the loan vary from policy to policy. If your policy offers this feature, you could approach your insurance company to avail it. Some banks also offer overdraft and loan facility against pledging your life insurance policy with them. But, in all such cases, your policy gets assigned to the lender as security for repayment.
What are the factors I should keep in mind before taking an online term plan?
? Ankur Gupta
In pure risk products, online or otherwise, the key differentiator is price. Term policies online tend to be cheaper than their offline counterparts by about 10% because of lower initial distribution costs. Shortlist offerings from different insurers on this basis. Premium will vary depending upon age, health conditions and lifestyle. The online channel is best suited for individuals who are both financially aware and comfortable with the online mode.
Apart from market-linked pension plans, are there any other market-linked insurance plans that I can buy now to save taxes and what are the benefits of such products?
? Palak Shah
Under Section 80C, all life insurance plans offer tax savings on the premiums paid as well as death and maturity proceeds, wherever applicable.
If I port my health insurance plan, which is two years old, what are the benefits that I
will lose?
?Prakash Raghavendra
Under portability, you can transfer most credits, such as the waiting period of pre-existing conditions and bonuses accrued, and also get waiver of the no-cover period. However, features and sub-limits (e.g. ceiling on hospital room rent) in the new plan could be different from your previous one. Also, costs could vary depending on plan conditions and features. Further, premiums could be impacted if your medical condition has changed in the period after you have purchased your previous plan.
n The writer is executive vice-president, Kotak Mahindra Old
Mutual Life Insurance
n Send your queries at fepersonalfinance@expressindia.com