LIC Market Plus Claiming of Sec 80C?



The premium or other payment paid on any insurance policy other than a contract for a deferred annuity shall be eligible for deduction to the maximum extent of 20% of the actual capital sum assured

under which kind of insurance policy covered by the maximum deduction of 20%?

2 Replies to “LIC Market Plus Claiming of Sec 80C?”


  1. Defination is self explainatery though terms used needs to be described.

    As per the Income Tax law, the Insured amount should be atleast 5 times of annual premium(in other words, premium paid should not be more then 20% of the sum insured) , then only it is fully exempted in 80C. If the premium paid is more then 20% of sum assured, then tax deduction will be to the maximum extent of 20% of the actual capital sum assured.

    That is why we can not deposit unlimited topup amount in Insurance ULIP, as all policies are designed in a way to respect this condition or we will have to buy additional insurance for additional topup.

    LIC Market Plus is not a insurance policy but it is a Pension plan(deferred annuity plan), though you can also opt for insurance with it by paying mortality charges. It is not mandatory to have insurance also in a deferred annuity plan(see defination “any insurance policy other than a contract for a deferred annuity shall be eligible……. “), so condition of Insurance policy is not applicable in Pension plan & unlimited topup is allowed.

    LIC agent rarely tells anyone about the tax implication of pension plans & the annuity story of this policy & missell it like hotcake.





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