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Term Insurance 249 views September 22, 2020
Term Insurance Plans are very useful to face life uncertainty. It gives you a life coverage in which your family will enjoy the benefits. In case of the unfortunate death of the insured, the family receives the decided sum assured. On the other hand, you can also enjoy term insurance tax benefits under section 80C and section 10(10D) as per the Income Tax Act 1961. So, you must explore these benefits as they allow some tax deductions while you compute your annual income. You will have to pay less tax if you show your premium of the term insurance while computing your income. Therefore, you must see how Section 80C and Section 10(10D) works.
Table of Contents
As you can see that there are two Sections in the Tax Rule that allows deductions in tax so you can see them below:-
Terms and Conditions
According to this section of the Income Tax Act 1961, your Maturity benefit will be tax-free. It simply means that the maturity amount received by the family after the death of the insured will be tax-free. You will receive the full amount at the time of maturity that was decided at the time of inception of the policy. You will not have to pay any taxes or the company will not deduct any taxes from the maturity amount.
The bonuses received at the time of maturity in a term insurance plan are also exempted from tax under Section 10 (10D)
Terms and Conditions
Well, now you know the Term Insurance Tax Benefits and you can save some extra tax while computing your annual income. On the other hand, the term plans give you a life cover so that your family can live a happy life even if you are not with them.