If you have also taken a life insurance policy, then tell us that the company will soon make many changes to the policy. These changes will be beneficial for you or you will know about the deficit only by reading the article. Let us tell you that the Insurance Regulatory and Development Authority of India had recently issued rules related to term, endowment, ULIP and pension plans. So let’s know what changes are likely.
Explain that under pension plan, the maximum withdrawal limit on maturity has been increased from one third to 60 percent. At the moment it will not be equal to National Pension System (NPS). 60 percent clearance on maturity in NPS is allowed and tax is not paid on it. 60 percent clearance has been allowed in the pension scheme, but only one-third of it will be tax-free. According to the report, up to one-third of the corpus will be tax-free, but above that, the tax will have to be paid. The rules related to clearance have changed before the scheduled time. At the end of the five-year lock-in, policyholders can withdraw up to 25% of the fund value, but such a policy can be done only three times in tenure. Such withdrawal will be allowed when there is a need for higher education, the marriage of children, purchase of house or building and treatment of serious illness of his or her spouse.
Freedom to invest in equity
The unit with the most effectual change is associated with elongation with a linked pension. The shine of this segment fell short on the condition that the annuity would be purchased from the insurance company issuing the deferred pension plan. Right now insurance companies have to give an assurance on vesting debt (from this date the annuity hoster starts getting the policy benefits), due to which they have to invest more in debt and they are unable to generate the long wait.
More options for buying an annuity
There is a significant change in opening up the market to buy annuity up to 50 percent of the investment amount. At present, the policyholder has to purchase an annuity from the same insurance company on maturity, which issues the policy. Lack of competition affects the interests of policyholders as they cannot do elsewhere for higher annuity rates. An annuity is a guaranteed pension income. He gets it from the investment date till the death of the policyholder.
Short period to get the surrender value
Explain that there is no need to wait for three years to get the guaranteed surrender value of the policy. Surrender value is the amount you get when you exit the policy before the scheduled time. Regardless of the terms of the premium repayment, now the policy of premium paid for at least two years will be achieved with the minimum Surrender Surrender Value. So far the premium payment term for a period of more than 10 years is a condition for a premium payment of at least three years.
Facility to reduce the premium
New rules have also been given to policyholders to reduce the premium after five years of the policy. Being a long-term product, insurance premiums have to be paid annually and the policy may lapse if there are no financial difficulties around that date. Instead, you can reduce the premium by 50 percent and also continue the policy.
Minimum cover in ULIP will be seven times instead of 10 times the annual premium. At present, insurance companies have to offer ten times the annual premium for those under age 45 and a seven-fold cover for those above 45 years. In the case of policymakers who do not want the protection element, the cover will be small and the mortality charge will also be reduced. To avail the maximum tax benefit under section 80C and 10 (10D), the life policy will have to cover ten times the annual premium. There will be no tax rebate under 10 (10D) in a policy covering seven times.
ULIP Revival Period
People who want to revive the ULIP get three years instead of two In the case of non-linked plans this period has been extended to five years. The insurance companies will have to inform the policyholders within three months of the policy lapse, if they wish to revive the policy, they can take appropriate steps….