{"id":1143,"date":"2022-02-05T11:15:35","date_gmt":"2022-02-05T05:45:35","guid":{"rendered":"https:\/\/www.insurancesamadhan.com\/blog\/?p=1143"},"modified":"2025-09-18T09:45:40","modified_gmt":"2025-09-18T04:15:40","slug":"tax-benefits-of-term-insurance-in-india","status":"publish","type":"post","link":"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/","title":{"rendered":"What are the Tax Benefits of Term Insurance in India?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_76 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#Term_Insurance_Tax_Benefits\" >Term Insurance Tax Benefits<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#Term_Insurance_Tax_Benefits_Under_80C\" >Term Insurance Tax Benefits Under 80C<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#Term_Insurance_Tax_Benefits_Under_80D\" >Term Insurance Tax Benefits Under 80D<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#Term_Insurance_Tax_Benefits_Under_10_10D\" >Term Insurance Tax Benefits Under 10 (10D)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#Tax_Benefits_on_Term_Insurance_Riders\" >Tax Benefits on Term Insurance Riders<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#FAQs\" >FAQs<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>Vinay is very careful when it is about buying an insurance product. Several times his friends suggested him to purchase a term insurance policy since he has his wife and children dependent on him. However, every time Vinay rejected the idea since he thought it was a mere waste of money. In the second wave of COVID-19 in India, he received news of one of his uncles\u2019 demise. His uncle left his wife and son behind. However, his aunt and cousin do not need to worry about the loan since his uncle had bought a term insurance policy. Vinay also found out that his uncle also got term insurance tax benefits when he was alive. This has finally convinced Vinay to buy a term insurance plan.<\/p>\n<p>The majority of us are like Vinay who thinks purchasing a <a href=\"https:\/\/www.insurancesamadhan.com\/blog\/three-things-should-be-in-mind-while-buying-a-term-insurance-plan\/\">term insurance policy<\/a> will not be beneficial anyway. Well, even if you survive through the policy term, you will be able to avail of the term plan tax benefit. Let us discuss to know more about this.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Term_Insurance_Tax_Benefits\"><\/span>Term Insurance Tax Benefits<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>As we talk about term insurance premium tax benefits, there is not just one benefit but many of them. This will help you to save money that can be used for the financial future of your family. Are you wondering about term insurance comes under which section? Let us discuss this too.<\/p>\n<p><center><a href=\"https:\/\/www.insurancesamadhan.com\/register\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" src=\"https:\/\/www.insurancesamadhan.com\/assets\/img\/contact.png\" alt=\"Get Resolutions for Insurance Complaints\" \/><\/a><\/center><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Term_Insurance_Tax_Benefits_Under_80C\"><\/span>Term Insurance Tax Benefits Under 80C<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Under Section 80C of the Income Tax Act, 1961, the Indian taxpayers avail of the basic term insurance tax benefits. As a matter of fact, this section is one of the most popular tax-saving tools among the majority of people. You can actually enjoy term insurance tax benefits of up to INR 1.5 Lakh for the premiums that you pay for continuing the term insurance plan. You should be aware of the crucial aspect about the upper limit of the tax deductions that comes under this section also include tax benefits on various types of investments such as tax-saving Fixed Deposits, Public Provident Fund (PPF), and various other tax-saving options. To enjoy the maximum tax benefits on life insurance, you have to invest in a substantial life cover, which can be helpful for your family members in the longer run.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Term_Insurance_Tax_Benefits_Under_80D\"><\/span>Term Insurance Tax Benefits Under 80D<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Under Section 80D, policyholders can enjoy tax deductions on the premiums that they pay for their health insurance policies. However, indirectly, one can also enjoy term insurance tax benefits under this section.<\/p>\n<p>If you are planning to avail of term insurance tax benefit under the 80D Section, you would need to have a health-related rider which can be a Surgical Care Cover, Critical Illness Cover, or something similar to these two. To put in other words, you can get the maximum tax benefit out of your term insurance premiums by choosing these riders along with having a health insurance cover.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Term_Insurance_Tax_Benefits_Under_10_10D\"><\/span>Term Insurance Tax Benefits Under 10 (10D)<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Apart from availing of the tax benefits, you and your family will also be able to save money through tax exemptions. And this is covered under Section 10(10D).<\/p>\n<p>To put it simply, the death benefit that is received under a term insurance policy is tax exempted. However, this is subject to several conditions that are provided there. Usually, the term insurance tax benefits do not come with an upper limit. This means the entire amount that will be received by your family under the term insurance plan is exempted from taxes.<\/p>\n<p>While you are a term insurance policyholder and looking for ways to enjoy tax benefits, you must be aware of the fact that term insurance tax benefits under Section 10(10D) are subject to particular conditions. It means that the death benefits under any term insurance plan are non-taxable if the premium you pay during the policy term does not go beyond 20% of the pre-determined sum assured.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Tax_Benefits_on_Term_Insurance_Riders\"><\/span>Tax Benefits on Term Insurance Riders<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Insurance companies offer several types of term insurance riders so that the policyholders can get additional coverage. However, the benefits that come with these rides are not limited to strengthening a term plan beyond the main feature.<\/p>\n<p><center><a href=\"https:\/\/www.insurancesamadhan.com\/register\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" src=\"https:\/\/www.insurancesamadhan.com\/assets\/img\/contact.png\" alt=\"Get Resolutions for Insurance Complaints\" \/><\/a><\/center><br \/>\nAvailing of the additional term insurance tax benefits depends on the rider that you choose with your term insurance policy as well as related conditions. Mentioned herein below are some of the ways in which term insurance policy riders can help you to avail of additional term life insurance tax benefits.<\/p>\n<ul>\n<li>When Critical Illness rider is added to a term insurance policy, it will make you eligible for tax deductions, and under Section 80D.<\/li>\n<li>While purchasing a term insurance policy, if you choose a rider like Returns of Premium, it helps in increasing the premium by helping you to save more money under Section 80C.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>While you are buying a term insurance policy, you must have a thorough knowledge of all these sections under Income Tax Act.<\/p>\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"FAQs\"><\/span>FAQs<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1758092099751\"><strong class=\"schema-faq-question\"><strong>What are the tax benefits of term insurance under Section 80C?<\/strong><\/strong> <p class=\"schema-faq-answer\">Under Section 80C of the Income Tax Act, 1961, you can claim tax deductions of up to \u20b91.5 Lakh for the premiums paid toward your term insurance policy. This is a popular method that people use alongside other investments like PPF and tax-saving fixed deposits. To maximise benefits, it\u2019s important to have a substantial life cover that protects your family while giving you tax relief.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758092159391\"><strong class=\"schema-faq-question\"><strong>Can I claim tax deductions on term insurance premiums for my parents?<\/strong><\/strong> <p class=\"schema-faq-answer\">Section 80C allows tax deductions on premiums paid for life insurance policies, typically for yourself, your spouse, and dependent children. To claim tax benefits for your parents\u2019 term insurance premiums, your parents must be financially dependent on you, and the policy must qualify under Section 80C. Always consult a tax advisor for specific eligibility in your case.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758092190723\"><strong class=\"schema-faq-question\"><strong>What are the conditions to qualify for tax benefits under Section 10(10D)?<\/strong><\/strong> <p class=\"schema-faq-answer\">The death benefit paid under a term insurance policy is fully tax-exempt under Section 10(10D), subject to one key condition. It is that the total premium paid during the policy term should not exceed 20% of the sum assured. If this condition is met, the entire payout the family receives upon the policyholder\u2019s demise will be exempt from income tax.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758092223843\"><strong class=\"schema-faq-question\"><strong>How does Section 80D provide tax benefits related to term insurance?<\/strong><\/strong> <p class=\"schema-faq-answer\">Section 80D typically provides tax deductions for health insurance premiums, but you can also get tax benefits on term insurance by adding health-related riders, such as Critical Illness Cover or Surgical Care Cover. Premiums paid for these riders qualify for tax deductions under Section 80D, giving additional savings beyond the base term insurance premium.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758092249950\"><strong class=\"schema-faq-question\"><strong>Are the death benefits from term insurance policy tax exempted?<\/strong><\/strong> <p class=\"schema-faq-answer\">Yes, the death benefits from a term insurance policy are tax-exempt under Section 10(10D) of the Income Tax Act, 1961. This means the family won\u2019t pay any tax on the payout received in case of untimely death of the policyholder, as long as the premium paid doesn\u2019t exceed 20% of the sum assured.<\/p> <\/div> <\/div>\n","protected":false},"excerpt":{"rendered":"<p>Vinay is very careful when it is about buying an insurance product. Several times his friends suggested him to purchase a term insurance policy since he has his wife and children dependent on him. However, every time Vinay rejected the&hellip; <a href=\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/\" class=\"more-link\">Continue Reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":1144,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","footnotes":""},"categories":[19],"tags":[],"class_list":["post-1143","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-term-insurance"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Tax Benefits of Term Insurance in India | Insurance Samadhan<\/title>\n<meta name=\"description\" content=\"Learn tax benefits of term insurance in India under Section 80C &amp; 10(10D). 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This is a popular method that people use alongside other investments like PPF and tax-saving fixed deposits. To maximise benefits, it\u2019s important to have a substantial life cover that protects your family while giving you tax relief.\",\"inLanguage\":\"en-US\"},\"inLanguage\":\"en-US\"},{\"@type\":\"Question\",\"@id\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092159391\",\"position\":2,\"url\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092159391\",\"name\":\"Can I claim tax deductions on term insurance premiums for my parents?\",\"answerCount\":1,\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Section 80C allows tax deductions on premiums paid for life insurance policies, typically for yourself, your spouse, and dependent children. To claim tax benefits for your parents\u2019 term insurance premiums, your parents must be financially dependent on you, and the policy must qualify under Section 80C. Always consult a tax advisor for specific eligibility in your case.\",\"inLanguage\":\"en-US\"},\"inLanguage\":\"en-US\"},{\"@type\":\"Question\",\"@id\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092190723\",\"position\":3,\"url\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092190723\",\"name\":\"What are the conditions to qualify for tax benefits under Section 10(10D)?\",\"answerCount\":1,\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"The death benefit paid under a term insurance policy is fully tax-exempt under Section 10(10D), subject to one key condition. It is that the total premium paid during the policy term should not exceed 20% of the sum assured. If this condition is met, the entire payout the family receives upon the policyholder\u2019s demise will be exempt from income tax.\",\"inLanguage\":\"en-US\"},\"inLanguage\":\"en-US\"},{\"@type\":\"Question\",\"@id\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092223843\",\"position\":4,\"url\":\"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092223843\",\"name\":\"How does Section 80D provide tax benefits related to term insurance?\",\"answerCount\":1,\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Section 80D typically provides tax deductions for health insurance premiums, but you can also get tax benefits on term insurance by adding health-related riders, such as Critical Illness Cover or Surgical Care Cover. 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This is a popular method that people use alongside other investments like PPF and tax-saving fixed deposits. To maximise benefits, it\u2019s important to have a substantial life cover that protects your family while giving you tax relief.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092159391","position":2,"url":"http:\/\/www.insurancesamadhan.com\/blog\/tax-benefits-of-term-insurance-in-india\/#faq-question-1758092159391","name":"Can I claim tax deductions on term insurance premiums for my parents?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"Section 80C allows tax deductions on premiums paid for life insurance policies, typically for yourself, your spouse, and dependent children. 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