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Budget 2020: 50 thousand additional tax rebate can be given for the first time on buying life insurance, consumers will benefit like this

Budget 2020 General insurance companies may announce money

The insurance sector hopes that such provisions should be made in the budget, which makes it easier for consumers to buy insurance products and is important to save tax.

Budget 2020

Every sector has some expectations from the upcoming Budget 2020 , which will be presented on 1 February. The insurance sector is also not far behind. Insurance companies want Finance Minister Nirmala Sitharaman to announce some measures to boost the life insurance sector in the Union Budget 2020-21. These will help in developing the reach of life insurance to more and more people.

Kamlesh Rao, MD & CEO of Aditya Birla Sun Life Insurance, says that we believe a separate deduction of Rs 50,000 for those who buy life insurance for the first time and an additional limit of Rs 50,000 for someone buying a pure protection or term plan Implementing life insurance work will speed up.

Offering an additional tax benefit to women policy holders will be an important step to encourage women to take insurance. Apart from this, giving exemption in section 10 (10) (D) will also be a desirable step. Explain that the amount received on maturity of a life insurance policy is tax free under section 10 (10D) of the Income Tax Act. However, if the annual premium of the policy is more than 10% of the sum assured, then this investment will not come under section 10 (10D).

GST rate of 12%

Rao also says that the budget should also explain the measures to bring equality between the life insurance and pension products offered by the NPS. Keeping the GST rate at 12 percent with input tax credit benefit will be beneficial for both policyholders and companies.

Section 80C limit expected to increase

According to India First Life Insurance Deputy CEO Rishabh Gandhi, it is expected that the coming budget will be focused on consumers. Accordingly, we expect tax benefits to increase under section 80C, which is currently 1.5 lakh. Apart from this, a specific 80C sub-limit for complete life insurance is required to give great emphasis on safety and long term savings.

General insurer not in beneficial position

Gopal Balachandran, chief financial officer and chief risk officer of ICICI Lombard GIC, says general insurers are not yet in a profitable position compared to other financial services companies. While the second asset class was benefited by discounting all benefits earned on long-term capital assets till 1 February 2018, this benefit has not been clarified for general insurance companies. This is important for insurers as it will help them to maintain solvency margins and reduce the risk of disasters. With this, insurers will be able to provide products and affordable solutions to customers according to their budget.

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