Why one should have insurance investments as a matter of habit rather than matter of tax shelter?

In older times, insurance was largely taken as a tax shelter savings at the last minute resorts for a common man. But ever since insurance sector opened for private sector in the year 2000, it has helped in spreading the awareness for insurance that has now emerged as the best long term saving habits option. Insurance is also extended to variety of needs of customers and is available for life as well as general purposes. For an individual, while life insurance is always safe for his family in case of any eventuality, general insurance is equally helpful in safeguarding ones security against natural/human created calamities. With proper insurance plans, one can safeguard his family as well as his retirements and also avail securities against life, health and wealth.

Insurance tax shelter uses investment in insurance to protect income or assets from tax liabilities it is used by many individuals when engaging in financial planning. By purchasing life insurance policies strategically an individual could potentially avoid paying a certain amount in taxes. Mainly the consumers are advised to purchase life insurance policies to the future tax liabilities or to shelter the growth of their investments from taxation.

Life insurance Tax shelter:

The idea behind this strategy is to shelter income and investments from taxes. For example, for an individual as large capital gains they will have to pay a certain amount of money in capital gains taxes to the government in order to avoid these problems you could potentially invest in a life insurance policy.

Instead of keeping the money and paying the capital gain taxes on it the individual used the money to buy a life insurance policy.