Single Premium Policy (ULIP) & Immediate Annuity Plans

POSTED BY Devi Ashok ON January 2, 2013 12:24 pm ONE COMMENT


Request you to clarify the following…

I am 44 and my husband is 46, we want to allocate 200000/- each for next 5 years in a ULIP as a single premium… we are not looking at MF as an option because of the higher expense ratios and the charges involved for swithces as compare to Ulips (currently for the Debt – 1.25 % pa and equity 1.35% pa seems to be much lower than charges paid while investing in a MF and you have various fund options with free switches) having said that would like to have clarity on the following

1. 80 C benefits – avialable or not

2. if we take out the money at the end of 60th months whether 10 10 D is applicable or not (for single premium, for policies issued before 31/03//2012), if we are looking at availing 10 10 D what should be the minimum risk coverage we should opt for??

3. If we opt for minimum life coverage of 1.10 times or 1.25 times what would be taxatation when i take out the money at 60th months or whenver i require on the returns i get and how is it calcualted or arrived at??

Single Annuity Plans – Immediate Annuity Plans

1. How the service taxes are calculated (whether on the premium paid or the annuity pay outs)?

2. What are the various single premium immediate annuity plans are avialable in the market and what is the % of returns to paid investors?

3. Whether the annuity received or tax exempted???




One reply on this article “Single Premium Policy (ULIP) & Immediate Annuity Plans”

  1. All financial planners and personal finance enthusiasts in this forum or anywhere else will ask you to stay away from ULIPs and ask you to invest through MFs with adequate (pure life) term insurance.

    Investing in MF over an year gives you tax free returns. Now with direct MF schemes
    you can invest in good mf schemes with low expense ratios

    Technically 80C applies to ULIPS premiums and 10(10)D applies to payout

    Annuities are an option for regular income but not in your 40s. The interest will be pathetically low (for all plans by all insurers) and the annuity is taxable (service tax only on premiums)
    Annuity is reasonable option for someone in 70s! Even when one is 60 for regular income one can go with tax free bonds, post office mis schemes. FDs

    Do stay away from these as well!

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