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Insurance
Time to rejoice for insurance sector
Nath Balakrishnan
THE flexibility given to investors in the Budget to decide on the proportion of asset allocation across instruments must certainly be music to the ears of players in the insurance sector. For quite a while now, insurers had been demanding an increase in the limit of contribution to long-term savings plans such as pension schemes. The pensions space has seen considerable activity in recent times and a slew of plans have been launched to tap into the growing demand for such instruments.
An increased contribution to such plans also means that investors would be able to build a sizeable corpus - something that was limited by the earlier limit of Rs 10,000 — to address their financial requirements in their post-retirement years. Further, with only insurance schemes providing such long-term savings plans, it is quite likely, indeed, those investors who chose other instruments, either because they were hamstrung by the earlier cap on pension plans or just to avail of a tax rebate, might just decide to divert such funds into plans that would make their life after retirement as fulfilling as their working years.
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