Multiple choice

Most individuals invest in life insurance policies for

  1. risk protection

  2. tax benefits

  3. easy liquidity

  4. high returns
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

While risk protection is the primary purpose of life insurance, most individual investors in India are primarily motivated by the tax benefits under Section 80C of the Income Tax Act. Life insurance premiums qualify for deductions up to ₹1.5 lakh per year, making it a popular tax-saving instrument.

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