Budget 2024: Here are the four key expectations from life insurers
NEW DELHI : As India's insurance regulator seeks to insure every citizen by 2047, the life insurance industry wants the government to add more incentives to increase penetration in the Union Budget 2024-25. The industry believes that the incentives would not only make insurance affordable, but would also facilitate long-term funds for investing in key areas of the economy. “India’s infrastructure sector is poised for a significant growth and requires a huge investment to support that growth.
Life insurance firms, with their long-term assets, can help spur this sector. The upcoming budget may look at incentivizing investments into life insurance products to facilitate infrastructure and overall development of the country," says Subhrajit Mukhopadhyay, executive director, Edelweiss Life Insurance. Here are the four key suggestions from the insurance industry: Life insurance companies offer annuity products to help retirees earn regular pension during their lifetime.
"Annuities are the only solution, that provide complete protection from the perspective of living longer (i.e. outliving one’s corpus), by providing a regular flow of income throughout one’s lifetime, purchased in lieu of a single lump-sum amount," says Mukhopadhyay. However, this pension amount is taxable.
The industry demands some tax incentive to make it more attractive. "The gap between needed and available retirement funds is expected to reach $85 trillion by 2050. To help close this gap, make taxes simpler or remove them for pension and annuity products to encourage more people to invest in these important financial protections," says Satishwar B., managing director and chief executive, Bandhan Life.
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