It furthers our comfort in the knowledge that we now have more and more options to secure ourselves. Not only ourselves, but our future and the future of our loved ones as well.

We have arrived at that particular point in time, where we are moving on from the strict divisions in various fields and no longer have to pursue a “either/or” option. The growth in the industry proves that there are some inquisitive and creative people out there who are slipping through the cracks of the previously-held notions and strict ideas, and combining options to create something new and unique altogether.  

This mentality and search for something unique and multifaceted has seeped into various different segments of our lives. One example of this boon in creative thinking is in our tax saving investment sector. Every single person who is aware and investing their time and knowledge in maintaining their taxes and investments, can now look into this option.  

Below, we have listed top 5 insurance-based tax saving investments -  

1. Life Insurance - Easily one of the most diverse and multifaceted policy’s out there, life insurance policy is something almost every single individual has. And this policy usually tends to offer some form of tax savings or tax benefits to the policyholder. Regardless of the type of the policy that the policyholder has (and there are quite a few! Such as Term End Policies, Market-Linked Policies and more), they all usually offer some tax benefit on the premium that is paid.  

● If the policy premium that is being paid is under Rs.1.5 lakhs, then the premium is considered under Section 80C of the Income Tax Department.

● The deductions claimed within five years of a policy being terminated and/or surrendered, will be added and taxed in an according manner. And,

● Upon maturity of the policy or in the event of death, the earnings are tax free under Section 10 D of the Income Tax Department.

2. Tax Saving Mutual Funds - For those who want their investments to save their taxes and give some form of tax benefit, this is the ideal solution.  

● This option is usually better suited to those who have a medium to high risk appetite for investments as they are well aware that the investments are usually locked in for 3 years.  

● The investments are all usually done in the stock markets and other assets.

● All investments made up to the amount of Rs.1.5 Lakhs in tax-saving mutual funds, are covered under the Section 80C of the income Tax Department.

● Upon maturity of the policy or in the event of death, the earnings are tax free under Section 10 D of the Income Tax Department.

3. Health Insurance - Another one of the few multifaceted policies that are available out in the market, this is another type of policy that almost every single individual out there must be armed and prepared with.  

● Health policies in addition to covering your health, offer a few tax benefits under Section 80C of the Income Tax Department.   

● To be eligible for a tax benefit, the insurance premium must go upto Rs. 20,000 and for senior citizens, upto Rs.15,000/-.

● In this scenario, the policyholder stands to have the total amount of Rs.35,000 (15,000 + 20,000) claimed as their tax benefit.

● Under the critical illness insurance policy, the maturity value of the policy is tax free.

4. NPS - The National Pension Scheme, eligible for anyone who is a citizen of India and is over the age of 18, til the age of 60, is said to be an extremely cost-effective scheme which can benefit all since the fund-management charges are said to be very low. Here, investors have two options through which they can manage their portfolio - either actively (which would be referred to as an active choice) or passively (which would be referred to as an auto choice).  

● Here, under the Section 80CCD of the Income Tax Department, any contribution that is made to the NPS is covered.  

● The amount of Rs.1.5 Lakh is the highest under three different sections (Section 80C and Section 80CCC) and any deduction beyond this amount cannot be factored in and will consequently, not be applicable.

● This option of investing in the NPS then becomes the most suitable option for anyone who would like to secure their future by setting some money aside, regardless of the kind or type of risk that individual would like to take.