Taxability of Pension policy

As per Section 10(10D) of the Income Tax Act, 1961 the amount of sum assured plus any bonus (i.e. the policy proceeds) paid on either maturity or surrender of policy or on death of the insured are completely tax free for the receiver subject to certain conditions.

If the assessee has claimed deduction u/s 80C subject to the condition specified therein, the surrender value of policy is eligible for exemption u/s 10(10D).

If the policy is surrendered before 5 years of it's completion than whatever 80C deduction claimed in earlere years under 80C shall be withdrawn and be deemed to be taxable in the year in which it is surrendered .

There are many types of policies are issued by different insurers and having different riders, terms, conditions, etc

So it's better to ask insurance company or agent through whom you took out policy for tax and taxation related issues. That would be better.