Are you aware that Life insurance policies are not attachable under certain circumstances.
As per section 60 (kb) of The Code of Civil Procedure, all money payable under a policy of insurance on the life of the judgment debtor, are not attachable.
Section 6 of the MWP Act states that the benefits under a Life Insurance Policy taken by a Married man, under MWP Act for the benefit of the married man's wife, or children or any of them, shall be payable only to the wife or children according to theratio decided by the Life Assured. Further it states that the said Policy does not form part of the estate (property) of the deceased Husband. Hence the husband does not have any control over the Policy and is not his asset. Therefore the said Policy cannot be attached by the Creditors of other Legal Heirs of the deceased husband.
It is to be noted that unlike in the case of other Life Insurance Policies which can be claimed by other Legal Heirs also (even though may not be attachable), MWP Act Policies can neither be claimed by the other Legal Heirs nor by the Husband's Creditors. Even the husband cannot claim any benefit. Therefore, an absolute estate is created in favour of the wife or children. This is a special privilege given by Law only to a Life Insurance Policy taken by a married man. This benefit is not available for any other asset.This benefit is not available for any other asset.
|Premium paid for life insurance
||Amount of premium paid in a financial year for policy in excess of 20% of the actual capital sum assured,
then deduction will be allowed only for premiums up to 20% of the sum assured.
|Premium paid for pension plans
||Benefit reversed if policy lapses;
amount received on surrender (whole/part)
of annuity plan and amount received as pension
is taxed as income.
|Premium paid for medical insurance
||Deduction is available upto Rs 25,000. The deduction for senior citizens is raised from Rs 20,000 to Rs 30,000. For uninsured super senior citizens (more than 80 years old) medical expenditure incurred up to Rs 30,000 shall be allowed as a deduction under section 80D. However, total deduction for health insurance premium and medical expenses for parents shall be limited to Rs 30,000.
|Benefits under insurance
||Sum received under a life insurance policy, including the sum allotted by way of bonus on such policy is exempt of tax.
- Sum received under Section 80DD(3), or
- Any sum received under a Keyman Insurance Policy, or
- Any sum received other than as death benefit under an insurance policy which has been issued on or after April 1, 2003 and if the premium paid in any of the years during the term of the policy is more than 20% of the Actual Capital Sum Assured.
- Under the Finance Act 2012 the exemption under Sec 10 (10D), on benefits you receive under life insurance policies issued on or after 1st April, 2012, shall be available only if the premium payable in any of the years is not more than 10% of the Sum Insured.
- However, the death benefit under your plan is always tax-free under sec 10(10D).