From 1st October, LIC policies will cost more. Life Insurance Corporation, which accounts for 83 per cent of the market share, will levy service tax of around 3 per cent on all non-unit-linked products beginning October 1.
This means if the annual premium for your money-back policy from LIC is Rs 10 lakh, you will have to pay an additional Rs 30,000.
While private insurers add a service tax component to the premium paid by customers, LIC has not been levying the tax on its popular endowment and money-back plans.
From October, however, all LIC policies will attract a separate service tax, says a senior company official.
Resource:
http://www.thehindubusinessline.com/industry-and-economy/banking/from-oct-service-tax-to-make-lic-policies-pricier/article4877994.ece