As part of their proposal for the upcoming Union Budget, which will be published in February, the life insurance sector has suggested that the government establish a separate bucket for tax rebates under section 80 (C) and make annuities tax-free for the benefit of subscribers.

According to Karthik Raman, CMO and Head – Products, Ageas Federal Life Insurance, the Rs 1,50,000 limit for tax refunds is a rather crowded bucket that does not leave much room for life insurance payments (to obtain the full advantage of tax exemption).