New Delhi, Feb 1 Life insurance stocks sold off heavily after the Union Budget pushed for a new tax regime and curtailed tax benefits on high value insurance policies.
On BSE, LIC was down more than 8 per cent, HDFC Life was down more than 10 per cent, Max Financial was down more than 9 per cent, SBI Life Insurance was down more than 9 per cent while ICICI Prudential Life Insurance was down more than 10 per cent.
Vinod Nair, Head of Research at Geojit Financial Services said life insurance players witnessed heavy selling as the Budget pushed for the new tax regime, making insurance products less appealing as a tax-saving tool.
Insurance policies where the premium is over Rs 5 lakh will no longer be tax exempt, as per the provisions in Union Budget 2023-24.
Kapil Mehta, Co-founder, SecureNow Insurance Broker said the income from traditional insurances where the premium is over Rs 5 lakh will not be tax exempt. While, this will dampen the interest of individuals to buy high value traditional insurances, it will increase the focus on term plans and pure risk covers which is good.
A concern is that it should not result in a significant shift towards purely investment oriented unit link insurances, Mehta said.
Arihant Bardia, CIO and Co Founder, Valtrust said if premium paid on insurance policies
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