Is it possible to combine two policies of the same company and create a new policy? An LIC agent told me he can combine two plans and customise a policy for me. I want a policy that will give me a lumpsum once a year and a monthly income after I retire. Is there any such product that offers both these options together?
—Mohan Bhatt
Yes, it is possible to buy two different policies which, in combination, meet your specific needs. By combining, the LIC agent will ensure that you can pay premium for both policies together. Please be aware that from a contractual obligation standpoint, both policies continue to be distinct. As per your precise need, you may need to purchase an annual income policy and a pension plan. The annual income policy, after the completion of its premium paying term, will give you a lump sum once every year, while the pension plan will help you create a corpus with which you can purchase a monthly annuity post retirement. Currently, no single product can fulfil both these requirements.
Having said this, there are some Unit Linked Plans available which provide customers the opportunity to effect partial withdrawals from time to time. You might want to understand these plans better as some of these might be able to meet most of your needs.
If I surrender my life insurance policy and get the money, will I have to pay tax on it?
—Poornam Bhatia
If your insurance policy was eligible for Sec 10 (10D) benefit while it was in-force, then on surrender you won't have to pay any tax on it.
Is it better to buy a term plan with personal accident rider or a separate personal accident plan?
—Kaustabh Singh
My recommendation will be to buy a single plan with both the benefits.
The writer is deputy CEO, IndiaFirst Life Insurance
Send your queries related to life insurance to personalfinance@dnaindia.net.
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