With just a few months in hand for making tax-saving investments, life insurance seems to be the top choice for consumers today.
With just a few months in hand for making tax-saving investments, life insurance seems to be the top choice for consumers today. The instrument is the most preferred of the lot for people in Delhi, followed by those in Mumbai, a consumer behaviour survey by IMRB for ICICI Prudential Life has revealed.
“About 79% of the people prefer life insurance vis-à-vis other tax-saving instruments. It is as high as 92% in Delhi, 88% in Mumbai and 57% in Chennai,” the report said.
Fixed deposits (FDs) are the other most popular investment tool, driven by the need for security.
ELSS, mediclaim and health insurance came in the next rung. Almost 98% of the respondents in Delhi made investments in life insurance and pension plans in the last two years, followed by 87% in Mumbai and 82% in Chennai.
The IMRB survey took into account males between 25 and 45 years with a monthly household income of Rs 40,000 per month and those who invest Rs 50,000 every year in any tax-saving instrument. The survey was conducted in Mumbai, Chennai and Delhi. There were 900 respondents with 300 in each of the centres.
“On an average, most have two policies. Security of life, funds and family were the main reasons for preferring life insurance. Besides, ease of payment, good policies, simple and straight investment, good service, behaviour with customers were the other reasons,” the study noted.
Interestingly, the survey found the awareness on tax-exemption levels under various sections to be low. Only 17% of the respondents were aware of the maximum amount that can be invested under life insurance for availing tax benefit. And only 16% of the respondents out of a base of 744 of those who have invested in life insurance were aware of Section 80C, under which they can save tax.
“Out of a base of 231 of those who have invested in health insurance, only 5% are aware of the Section 80 D under which they can save tax. And 91% are not aware of tax-exemptions that can be availed towards payment of health insurance premium for elderly parents,” it said.
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