Tax Benefit after making LIC policy as Paid-up.

POSTED BY jawwad ON January 13, 2012 5:50 pm COMMENTS (4)

I have Jeevan Anand Policy for which the SA is 15,00,000/- I have already paid premiums for last five years and I am planning to make it paid up policy now.

Could you please let me know whether I will continue to get the Tax Benefit after making my policy as paid-up?

Regards,
Jawwad

4 replies on this article “Tax Benefit after making LIC policy as Paid-up.”

  1. Dear Jawwad, Investing 60K prem. amount elsewhere ‘ll surely give you more than what this policy may provide in future as maturity. Regarding the paid up one, it’s a personal call that you are comfortable with the idea of paid up or you may surrender the same, get the money at a loss but reinvest the same elsewhere & get a sizable corpus after few years.

    Thanks

    Ashal

  2. jawwad@techmahindra.com says:

    Many Thanks Ashal & justgrowmymoney!!

    I am still little bit confused over making the policy paid up. Need a guidance from all the financial experts from Jagoinvester. Actually, I am paying annual premium of Rs.60,000/- and planning to invest these 60k in different scheme/s which gives fast return. That’s the reason I am planning to make my Jeevan Anand policy paid-up.

    Is this the right decision or should I continue paying preimium?

    Thanks & Regards,
    Jawwad.

  3. Dear Jawwad, If you are asking for the maturity amount to be received from your paid up policy. Yes the paid up amount ‘ll be tax free under section 10(10)(D) of current income act.

    In case in future, the said section is modified, the new rule ‘ll be applicable to your case.

    For the ongoing prem. amount the reply is already there with you from dear justgrowmymoney, hence not repeating the same.

    Thanks

    Ashal

  4. After making the policy paid up you just stop contributing so you cant claim any benefits in future.

    If you have already made the payment for this financial year (Say Oct 2011) and have decided to make the policy piad up your policy (Jan 2012) will anyway accrue the bonus till the premium date next year (Oct 12). It will become truly paid up only after that because you have already paid premium money for the current 1 year .

    Technically, this amount contributed is eligible for Tax Benefit

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