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What is the minimum lock-in period in ULIP to avail tax benefit in India.

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There is no minimum lock-in period for ULIP to avail tax benefit.

However most of the Insurance companies have a lock-in for 3 to 5 years for normal closure of the policy. Before this period, there are surrender charges apart from higher premium allocation charges in the first 2 years. So if you are planning to buy an ULIP, get the tax benefit and close; then you will actually be loosing more money then the tax benefit you would stand to gain.

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I assume you want to take benefit u/s 80C. In case of ULIP of UTI or LIC Mutual Fund, minimum period of holding is 5 years.

In case of other insurance premium period of holding is 2 years.

Refer Page A-229 of Direct Tax Ready Reckoner by Taxman

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