Surrender Jeevan Anand Policy

POSTED BY balaky ON March 12, 2012 2:32 pm COMMENTS (4)

Hi
I have taken a Jeevan Anand Policy and paid the premium for 6 years. yearly premium is Rs28,448/-. The accured bonus is 134400/- and the surrender value I get is Rs 101081/-. The sum assured is 6 Lakhs. Can you a) Let me know if it is good to surrender and take a Term Insurance for 50Lakhs or so. b) What will be the implication of Tax on the premium?. I think apart from the first 2 years I did not need the premium to cover for 80 C.

4 replies on this article “Surrender Jeevan Anand Policy”

  1. Dear Balaky, May I know the back ground of your pin pointing the 50L sum assured?

    Please invest the surrender amount in either Eq. MFs or a balanced fund for a long term say 12-15 years. As the 5Y holding period is already over, no need to worry for taxation or 80C reversal on Jeevan Anand prem. Surrender is tax free.

    Thanks

    ashal

    1. balaky@gmail.com says:

      Hi Ashal,
      Thanks for the update that the return is not taxable.

      Let me know your views on Surrendering vs Paid up. Which is good?
      As far as the 50L while I do have a 50L Term cover from my employer this was purely to cover the Housing Loan and I did not take any Insurance when I took the loan .

      1. Dear Balaky, surrender is better than paid up. As you ‘ll get the amount fixed today with out any more earning in between after X years. Whereas in case of surrender, you have the option to invest it & earn higher returns.

        Please purchase a separate term plan for yourself, apart from the one provided by your employer.

        Thanks

        Ashal

    2. Muthu says:

      Hi Ashal Jauhari,
      1. Is 5 yrs- the minimum holding period to escape the reversal of tax benefits?
      In few places, I came to know it as 2 yrs. But not sure. Can you please clarify this?
      2. Also, if i don’t pay any premium after the 1st half yearly payment, will i be entitled to pay tax for it the next year because I have not held the policy for that stipulated time of 2/5 yrs?..
      If so, how do I show it while filing income tax.

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