Is Claim Amount Taxable in Term Insurance?

What Is Term Insurance Claim Amount?

Is a Term Insurance Claim Amount Taxable?

When Is Term Insurance Claim Amount Not Taxable?

FAQs About Term Insurance Claim Amount:

Is it essential to pay GST on term insurance claim amount under Section 80C of the Income Tax Act?

You will not have to pay any GST on the claim amount of the term policy. However, you will have to pay a GST of 18% and other relevant taxes on term insurance premium under Section 80C of the Income Tax Act.

Can you enjoy tax benefits on discontinuing the term insurance policy?

Once you stop paying the premiums, your policy gets automatically terminated. Under such circumstances, you will not be eligible for a tax benefit if you raise a claim. Also, your nominee won't be able to receive a tax benefit on the claim amount in case of any unfortunate incident.

Who can be the nominee for a term insurance policy?

In a term insurance policy, a nominee is a person who receives the sum assured based on the policy terms and conditions. Now, you can choose your spouse, parents, children or even siblings as a nominee at the time of purchasing a term insurance policy. This way, you can provide them with financial security in case of your untimely demise.

Which health-related add-ons are applicable under section 80D?

Some of the health-related add-ons that are applicable under section 80D are Critical Illness, Hospital Care Rider, Surgical Care, and so on.