Tax benefits have not completely gone. 80C still exists. ULIP still exist. (Old regime still exist and those who want to invest for tax benefit + Insurance still have that option). As per interview, even traditional policies upto 5L aggregate premium still is exempt. Also, important point mentioned in interview is that tax benefit was not only reason for affluent Indians to invest in such policies – their another USP is certainty of interest rates. During Pandemic times, all got taste of low & volatile interest rates so I agree with Vibha ma’am in interview that affluent Indians would like some part of their debt savings to have a certainty of interest rates over very long term, irrespective of taxable nature.
Also, hypothetically, if say everyone moves to new tax regime, which have no deductions, will people stop investing completely in products that would have fallen into 80C earlier or buying Insurance? In best interest of all, consumers should be educated with benefits of each product for what they are…and each product, be it Insurance (different type), NPS, PPF, EPF, ELSS etc. have their unique advantages (and disadvantages) than just Tax benefits…and I feel Insurance firms have this task in hand now to rightly educate consumers.
Swift distribution & digital channels can be enablers. Overall I feel this is good for the ecosystem and future roadmap of Insurance in India. Also, composite license is a big welcome as well for Life insurance firms. Stock valuations is another story though, which I am not good at.
Disc: Same as above
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