Prices Increasing soon Prices Increasing Soon

Tax Saving Insurance Plans – Life Insurance and Health Insurance

Are we familiar with tax saving instruments that serve a dual purpose? We already know of the tax savers like PPF, Mutual Funds, Fixed deposits, etc. What if we tell you that investing in a good insurance plan can help attain your financial goal as well as help save on tax. Would you believe us?

Read more
Gets ₹1 Cr. Life Cover at just
COVID-19 Covered
The Policybazaar Advantage
Dedicated claim support for family FREE
Upto 10% discount for buying online
Only certified experts will call you on 100% recorded lines
We are rated~
58.9 Million
Registered Consumer
Insurance Partners
26.4 Million
Policies Sold

#All savings and online discounts are provided by insurers as per IRDAI approved insurance plans | Standard Terms and Conditions Apply

By clicking on "View plans" you agree to our Privacy Policy and Terms of use

~Source - Google Review Rating available on:-

Life is Unpredictable! Protect your family’s future
Get ₹1 Crore Life cover starting from ₹384/month+
We don’t spam
Check Your Premium Now
Please wait. We Are Processing..
Get Updates on WhatsApp
The Policybazaar Advantage
Policybazaar Advantage Icon
Dedicated claim support for family FREE
Policybazaar team will help and support you at the time of claim. A personal claim handler from our team of experts will get in touch with you when your nominee applies for a claim on our website.
Policybazaar Advantage Icon
100% calls recorded to ensure no mis-selling
We will make sure you get what is promised by the advisors. We conduct regular monitoring of our calls to make sure you get the best experience.
Policybazaar Advantage Icon
Exclusive lifetime discount upto 5% for buying online
The discounts will be valid for the entire policy payment term and is not available if you choose to buy the insurance through offline agents.
Policybazaar Advantage Icon
Advisors available in your city
Our advisors are available in more than 55 cities across India and can help you at your doorstep in understanding the plans and in documentation.
Policybazaar Advantage Icon
Refund at the click of a button
In case you aren’t happy with your purchase, you can cancel your policy hassle-free at the click of a button. We will help you with the cancellation and refund of your policy.

Most are unaware of the fact that different types of tax saving investments plans are available in the market. Moreover with rising medical costs everyone needs sufficient insurance or medical coverage. This dual benefit are rarely found in tax saving tools other than tax saving insurance plans. 

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

Here are a few highlights that will help you understand the how tax saving insurance plans work. This should help you invest wisely and save on that much dreaded tax that feeds on your salary every financial year end. 

The Basics

When you purchase an insurance policy, you are liable to pay its premium. Under Section 80C, premium paid for any life insurance policy taken qualifies for tax deduction. Tax deduction is applicable only to the policyholder on account of insurance premium paid for a particular financial year. Tax exemption u/s 80C (as well as u/s 80CCC & 80CCD) is upto a maximum amount of Rs.1,50,000. A minimum holding period of a tax saving insurance policy, however, is defined as 2 years. 

Under section 80D, the investor can claim for tax deduction on purchase of medical insurance policy as per Income Tax Act, 1961. More on this can be learnt from the income tax government of India website. The premium should be payable by the policyholder, his/her spouse, and/or parents and/or dependent children. The tax deductible is uptoRs. 25,000, whereas if premium is paid for senior citizens then the tax deductible is Rs. 30,000. 

Now that we’ve understood the basics of the basics of a tax saving insurance plan, like life insurance and Mediclaim insurance policies, let us try and understand it better. This will help you as an investor affirm the type of insurance you want to purchase for you and your family. 

Life Insurance and Tax Deductions (Section 80C)

Life insurance policies have a lot to offer, e.g., wealth maximisation, life coverage, retirement plans, child’s saving options besides functioning as a tax saving insurance plan. Section 80C of the Income Tax Act has the following conditions with respect to tax deductions on life insurance policies. 

Either the individual policyholder or HUF (Hindu Undivided Family) is eligible to claim tax deductions on premium paid.NRI’s or even those of foreign nationality who have invested in life insurance policies within the country is eligible for exemption under the Act. As an investor in life insurance policy you can be the policyholder or purchase policy for your spouse, dependent parents or dependent children. There is no limit mentioned to the number of children included.You can purchase either a traditional plan policy, pure term policy or even ULIP’s. All of them fall under the category of life insurance policies. Maximum amount that is exempted from tax is Rs. 1,50,000. This includes all avenues of insurance or investment holdings and premium paid on life insurance. Minimum years of holding life insurance policy is 2 years and maximum is 5 years. If the policyholder decides to terminate or surrender the policy within this timeframe, the benefits he got under the tax saving insurance plan will be reversed.Tax deduction on your life insurance policy is based on certain qualifications. If issued after 1st April 2012, premium is less than 10% of sum assured. If issued before 1st April 2012, premium paid should be lower than 20% of sum assured.

Tax benefit is subject to changes in tax laws

Health Insurance/ Mediclaim and Tax Deductions (Section 80D)

Section 80D allows for the individual policyholder or HUF, NRI or foreign resident eligible to claim for tax deductions on premium payment of health insurance/mediclaims.U/s 80D, there are a few payments that can be exempted: Health Insurance policy payment,Central Government Health Scheme (CGHS),Cost/expense on health checkup Premium payments for health insurance policy can be made by the policyholder, spouse, dependent children or even dependent parents.Any type of accident policy however does not apply for tax deduction. What can qualify for tax deduction are mediclaim policies and critical illness policy.Tax exemption on health insurance premium is relative to the year the premium is paid, this is called “payment basis”.Tax deduction is applicable only if the premium is paid in other modes of payment other than cash.The value received on maturity is exempted from tax under critical illness policy.Maximum tax benefit for policyholder is Rs. 25,000 whereas for senior citizen is Rs. 30,000.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

There are certain exemptions when it comes to tax saving insurance plans that you might want to make note of. Section 10(10D) states that all proceeds received for your life insurance policy are also exempted from tax as per the Act.

Premium By Age

Life Insurance Articles

  • Recent Article
  • Popular Articles
24 Apr 2024

Most Common Life Insurance Frauds in India

Life insurance fraud is a financial crime that can be committed

Read more
09 Aug 2023

What High Net Worth Individuals (HNIs) Do To...

High net worth individuals often opt for life insurance plans to

Read more
28 Jun 2023

A Review Of ICICI Prudential Life Insurance

“Policy Bazaar insurance clarified the term policy for me, so

Read more
27 Jun 2023

A Review Of HDFC Life Insurance

“I recently bought an HDFC term plan and it is the best

Read more
20 Jun 2023

Best Life Insurance Policy in India with High...

The best life insurance policy in India is a type of life

Read more

Life Insurance for Parents in India

With the increase in the average life expectancy rate, the older population in India is on the rise. Most of the

Read more

Life Insurance for NRI

Going beyond geographical boundaries to study or pursue a career abroad is a common aspiration for many

Read more

Life Insurance Quotes

Life insurance quotes are the approximate premium rates for the specific life insurance policy. It helps you

Read more

Canara Guaranteed Fortune Plan

Canara HSBC life insurance company introduces a guaranteed fortune plan that provides assured benefits to life

Read more

Life Insurance For Women

Consistently, the role of woman in the family and the business world has changed a considerable amount

Read more
Need Help? Request Callback
View Plans
Download the Policybazaar app
to manage all your insurance needs.