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The Life Insurance Corporation is a life insurance company that almost everyone has heard of. You must have seen various TV ads on LIC’s life insurance schemes. But did anyone tell you that LIC schemes have tax benefits? According to Section 80C of the Income Tax Act 1961, premiums paid towards life insurance policies are eligible for tax deductions up to Rs. 1,50,000. This means that while financially protecting your family against the harsh realities of life, you can also save tax! In this blog post, we will provide you with details regarding the best LIC schemes for tax benefits.
The Life Insurance Corporation of India is perhaps the most famous life insurance company in India. But did you know that it was established under Section 3 of the LIC Act 1956? What was the reason behind the establishment of LIC? Well, the reason was to spread life insurance in India and provide all insurable persons with adequate financial cover at a reasonable cost.
LIC offers various LIC schemes for tax benefits. All their schemes are pretty reliable as LIC has been in the life insurance business for a long time now. Although each of their schemes is reliable, all of them come with different advantages and limitations, according to which you must make your choice.
Mentioned below is the List of LIC Schemes for tax benefits. We will guide you through all the important details of these various schemes.
Here is a list of the top LIC schemes offering tax benefits.
Perhaps one of the most popular LIC schemes for tax benefits, LIC Jeevan Labh is a non-linked, participating, individual life assurance saving plan. Not only does this LIC scheme offer protection but it also comes with a savings feature. LIC Jeevan Labh provides financial assistance to the family of the deceased policyholder in case of unfortunate death any time before the maturity period and also a lump sum amount at the time of maturity of the surviving policyholder. Not only this. Through the loan facility, the plan also takes care of the policyholder’s liquidity requirements.
The maximum age entry under Jeevan Labh LIC is 59 years while the minimum entry age is 8 years. This scheme is available in policy terms of 16, 21 and 25 years. The maximum maturity age under the Jeevan Labh LIC is 75 years. You can avail tax benefits under Jeevan Labh LIC up to a maximum limit of Rs. 1,50,000 for premiums paid under section 80C of the Income Tax Act. The maturity proceeds of this plan are exempt from Tax under Section 10(10D) of the Income Tax Act.
LIC Jeevan Umang is one of the best LIC schemes for tax benefit. This scheme is a non-linked, with-profits whole life assurance plan. Under this scheme, the policyholder gets annual survival benefits from the end of the premium paying term till the maturity. A lump sum payment is made to the policyholder at the time of maturity of the policy and in case of death of the policyholder during the policy term, a lump sum payment is made to the eligible nominee or beneficiary.
All premiums paid towards Jeevan Umang scheme of LIC is considered for income tax saving under Section 80C of the IT Act 1961. You can invest up to Rs. 1,50,000 under Section 80C and save up to Rs. 46,800 every year. The pension and other benefits/returns from this plan are also tax free.
To be eligible for LIC Jeevan Umang, the minimum entry age is 90 days whereas the maximum entry age is 55 years. At the end of the premium paying term, the policyholder must at least be 30 years old.
LIC New Jeevan Mangal is a LIC term insurance plan. It is basically a protection plan that comes with a return of premium upon reaching the maturity period. The LIC new Jeevan Mangal helps your family to meet all the financial obligations/requirements in case of the policyholder’s unfortunate event of demise.
The New Jeevan Mangal LIC offers a minimum sum assured of Rs. 10,000. The minimum monthly premium installment for this scheme is fixed at Rs. 60. The premiums for this plan can be made in either lump sum or regularly at yearly, half yearly, quarterly, monthly or weekly intervals.
The minimum entry age for the new Jeevan mangal scheme is 18 years while the maximum entry age is 55 years. You can avail tax benefits under LIC New Jeevan Mangal up to a maximum limit of Rs. 1,50,000 for premiums paid under section 80C of the Income Tax Act. The maturity proceeds of this plan are exempt from Tax under Section 10(10D) of the Income Tax Act.
The LIC New Money Back scheme is a traditional life insurance plan offering guaranteed return and bonus with a savings feature. The policy continues for 20 years while the premiums need to be paid for a 15 years period. This LIC scheme can be purchased if the individual is a minimum age of 13 years and a maximum age of 50 years. The maximum age at maturity is 70 years.
At the end of every 5 years, 20% of the sum assured is paid to the policy holder on survival and the remaining 40% of the sum assured along with bonuses would be paid to the policy holder on survival till the policy term’s end as maturity benefit. This is why this LIC scheme is known as LIC New Money back scheme.
The policyholder has the option to avail accidental, disability benefit rider, critical illness and term rider at additional charges which are nominal. The premiums paid towards this policy are eligible for a deduction of up to Rs. 1,50,000 under Section 80C and the maturity amount is tax free under Section 10 (10D). The premiums for the LIC money back scheme can be made yearly, half yearly, quarterly or monthly. The basic sum assured under this scheme is 1,00,000 and can be more. After 2 years of this policy’s continuation, individuals can avail a loan facility against this policy. It is one of the best LIC schemes for women, as well as men.
LIC Jeevan Lakshya Plan is an LIC scheme which offers risk cover and a savings feature and is most suitable for the goal of providing assistance to children and family. Jeevan Lakshya provides life cover during the policy’s term and sum assured along with bonuses on survival as maturity.
The minimum age and the maximum age for entry into the scheme are 18 years and 50 years, respectively. All the premiums paid towards this scheme are eligible for tax exemption up to Rs. 1,50,000 under Section 80C of the IT Act. Additionally, the maturity amount earned by the policyholder is free from taxation as per Section 10D.
The LIC Jeevan Lakshya Plan is one of the top LIC schemes and one of the best LIC Schemes in India. In case of the demise of the policyholder during the policy term, a 10% sum assured every year till maturity is provided and it again provides sum assured + bonuses as maturity to the policyholder’s family. The sum assured serves as annual income which can be used for funding child education, marriage of the daughter/son, paying off loans or bills, etc. The policyholder under this scheme can avail the optional LIC policy benefits like accidental and disability rider, term rider and critical illness rider. You can avail loan facility against LIC Jeevan Lakshya Plan after 2 years since purchase of the plan.
Life insurance schemes must be availed by all the individuals who want to ensure that even after their demise, their family gets financial protection. The top LIC schemes mentioned in this blog post not only provide death benefits to beneficiaries, but also survival benefits to the policyholder. In addition, all these LIC schemes are eligible for tax exemption under 80C of the Income Tax Act and their maturity amount is tax free under Section 10(10D). LIC is one of the most trustworthy and reliable life insurance companies in India, and you can count on them for purchasing a life insurance scheme. If you want to learn more about these schemes, you can visit the nearest LIC branch in your locality.
Disclaimer: While purchasing a life insurance plan/policy, kindly do your own market research and/or consult with a professional. We do not recommend you to purchase a policy based on this blog post and it is completely your responsibility and choice to choose a life insurance policy. Additionally, the features of the policies might change in future so kindly contact LIC or visit their official website for latest updates.
Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.
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