Written by : Knowledge Centre Team
2026-01-08
888 Views
6 minutes read
Share
General Details about Union Budget 2021-22
The first-ever digital Union Budget 2021-22 was presented by Union Minister for Finance and Corporate Affairs Smt Nirmala Sitharaman on 1st February 2021. The theme of this year’s union budget largely revolves around COVID-19, economic revival, and growth and aims to meet the demands for political, economical, and strategic changes in the post-Covid world.
The budget was presented on the basis of the six pillars.
- Health and wellbeing
- Physical and financial capital and infrastructure
- Inclusive development for aspirational India
- Reinvigorating human capital
- Innovation and R&D
- Minimum governance and maximum government.
Union Budget 2021-22 reflects a firm commitment of the government to boost economic growth by investing in infrastructure development. This is substantiated by an increase in capital expenditure by 34.5% over BE 2021-22.
Tax, Non-Tax Revenue, and Life Insurance Detailed in Union Budget 2021-22
No changes in income tax slabs, rates, deductions, and redemptions in 2021-22.
Achievements:
- Corporate tax rate slashed to make it among the lowest in the world
- Burden of taxation on small taxpayers eased by increasing rebates
- Return filers almost doubled to 6.48 in 2020 from 3.31 crore in 204
- Faceless assessment and faceless appeal introduced.
Relief to senior citizens:
- Exemption from filing tax returns for senior citizens over 75 years of age and having only pension and interest income; tax to be deducted by paying the bank.
Relaxation to NRIs:
- Rules to be notified for removing hardships faced by NRIs regarding their foreign retirement accounts.
Incentivising digital economy:
- Limit of turnover for tax audit increased to Rs. 10 crores from Rs. 5 crores for entities carrying out 95% transactions digitally.
Attracting foreign investment for infrastructure:
- Infrastructure debt funds made eligible to raise funds by issuing zero-coupon bonds
- Relaxation of some conditions relating to prohibition on private funding, restricting on commercial activities and direct investment.
Key changes in tax and life insurance
- No more tax exemption for ULIPs - Unit-Linked Insurance Plans, with an annual premium above Rs. 2.5 lakh
- Government to introduce life insurance IPO, initial public offering, in 2022.
- Increasing FDI in the insurance sector
- No changes in the income tab slabs
- Two PSBs, an insurer to be disinvested this year
Explanations:
- No more tax exemption for maturity proceeds of unit-linked insurance plans, with an annual premium above Rs. 2.5 lakh. The rules will apply for Ulips issued on or after 1 February 2021.
However, the amounts received under such ULIP on the death of the policy holder will remain exempt from tax. The death benefit will continue to remain tax-free in case of the unfortunate death of the insured. The implication of this is that the maturity proceeds are going to be taxed as equity mutual funds and so they come on par with mutual funds. This has a further incentive that the budget taxes returns from such ULIPs at 10% above an annual exemption of Rs. 1 lakh, on par with mutual funds.
Context of the same; as per section 10 (10D) of the income tax act, the provision exempts any amount received under a life insurance policy including ULIPs if the sum assured is more than 10 times the annual premium. The exemption includes death benefits, maturity benefits, and accrued bonuses. However, the new provision will apply to ulips only. For instance, there are money-back policies and endowment plans which provide maturity benefit. The tax benefit received under such plans will remain exempted.
- Life insurance FDI ( foreign direct investment) hiked from 49% to 74% Increasing the FDI limit to 79% from the incumbent 49% is a bold move. it will provide an immediate backstop in terms of capital for growth and improve the insurance and the financial state of the country. An increase in life insurance penetration will pave way for the generations of new employment opportunities, which in turn would help the efforts of the government to revive the economy.
- Life insurance IPO in 2022
“We would also bring the IPO (initial public offering) of LIC in 2021-22, for which I am bringing the requisite amendments in this session itself”, Finance Minister Nirmala Sitharaman said in her budget speech.
The legislative amendments to this effect will be launched in Parliament in the budget session, the finance minister added, as the government will need the approval of the parliament to facilitate the sake of the LIC stake.
The government has a divergent target of Rs. 1.75 lakh crore for FY22. In FY21, the government had budgeted raising Rs 2.1 lakh crore through divestments, but failed to achieve the target as disinvestments of BPCL and LIC could not be completed during the year.
- Two PSBs, an insurer to be disinvested this year
Two public actor banks and one general insurance company are expected to be disinvested this year, this feature also comes under the IPO of the LIC in 2022 and was presented by Finance Minister Nirmala Sitharam during the union budget in Lok Sabha on 1st February 2021. This will be in addition to the disinvestment of the IDBI Bank.
The Government currently owns 100% of the LIC, while it holds around 46.5% in the IDBI bank. It aims to garner Rs. 90,000 crore from the listing of the LIC and stake dilution in the IDBI bank in the next fiscal out of a total disinvestment target of Rs, 2.10 lakh crore.
Smt Sihtaram said that the strategic sale of the BPCL, the IDBI bank, Air India, the Shipping Corp, Container Corp, and other disinvestments would be completed in 2021-22 in spite of Covid 19. Indicating that the disinvestment process was in full swing, the minister said that the Niti Aayog had been asked to come up with the list of companies that may be disinvested next.
Secure Your Family’s Future with the Right Life Insurance Plan
Enter OTP
An OTP has been sent to your mobile number
Didn’t receive OTP?
Application Status
Name
Date of Birth
Plan Name
Status
Unclaimed Amount of the Policyholder as on
Name of the policy holder
Policy No.
Address of the Policyholder as per records
Unclaimed Amount
Sorry ! No records Found
Request Registered
Thank You for submitting the response, will get back with you.
Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
Recent Blogs
5 Benefits of Gifting Life Insurance Cover to Your Spouse
09 July '26
1101 Views
8 minute read
Discover how gifting life insurance to your spouse supports financial security, protection and long-term family planning.
Read More
Life Insurance
How to Secure Your Future with Whole Life Insurance?
09 July '26
1026 Views
6 minute read
Discover how whole life insurance provides lifelong coverage and helps support long-term financial planning goals.
Read More
Life Insurance
Best Short-Term Investment Options with High Returns in 2026
08 July '26
1361 Views
12 minute read
Best Short-Term Investment Options in India. Find the top 10 short-term investment options with high returns for a short time.
Read More
Life Insurance
What is Deductible in a Life Insurance Plan?
08 July '26
1410 Views
8 minute read
Learn what is deductible in a life insurance plan and how it impacts your coverage. Get expert insights and guidance from Canara HSBC Life Insurance for better planning.
Read More
Life Insurance
Persistency Ratio in Insurance: Meaning and Importance
08 July '26
2868 Views
10 minute read
Know what the persistency ratio in insurance means, how it is calculated, why it matters for insurers and policyholders, and what it indicates about policy performance.
Read More
Life Insurance
What is Insurance? Meaning, Types & Benefits Explained (2026)
07 July '26
9340 Views
10 minute read
Understand insurance meaning, types, benefits & why insurance is important for financial security in India.
Read More
Life Insurance
PLI Interest Rate 2026: Updates, Key Features & Eligibility
07 July '26
1231 Views
9 minute read
Explore the latest PLI interest rates, bonus updates, and key features for 2026. Learn about policy types, eligibility, and benefits of Postal Life Insurance.
Read More
Life Insurance
Happy Father's Day 2026: Celebrate Every Father's Promise of Protection
20 June '26
32 Views
5 minute read
Celebrate Happy Father's Day 2026 by honouring every father's love, care and commitment. Discover how life insurance helps protect your family's future.
Read More
Life Insurance
What is an Insurance Coverage?
06 May '26
1403 Views
8 minute read
Learn what insurance coverage means, how it works and why choosing the right coverage is important for financial protection.
Read More
Life Insurance
Life Insurance - Top Selling Plans
We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.
Family Shield: Enhanced Protection
iSelect Smart360 Term Plan
- 3 Plan options
- Life cover till 99 years
- Steady income benefit
- Block your premium at inception
Start Young, Pay Less, Stay Secured
Young Term Plan
- Life cover till 99 years
- Coverage for spouse
- Block your premium rate
- Covers 40 critical illness
Fixed Returns, Zero Risks & Worries
iSelect Guaranteed Future Plus
- 4 Plan options
- Life cover + Guaranteed benefits
- Accidental death benefit
- Premium protection cover
Popular Searches
- Term Life Insurance
- Whole Life Insurance
- Critical Illness Insurance
- Accidental Death Benefit Rider
- Compare Life Insurance Quotes
- Best Life Insurance Companies In India
- Factors Affecting Life Insurance Premiums
- Life Insurance Rider
- Life Insurance Plans
- Types of Life Insurance
- Term Life Insurance Tax Benefit
- What is Insurance?
- Life Insurance Premium
- Life Insurance For Children
- Life Insurance for Seniors
- Whole Life Insurance Plans
- Group Life Insurance Plans
- Life Insurance Claim Process
- Tax Benefits of Life Insurance