Life insurance: Vyakaranam says insurance has for long been the front runner whenever investments regarding tax savings. However, buying excessive insurance defies its purpose and leads to the investor holding unnecessary products. It is best to avoid insurance if the aim is only tax saving. Term insurance or pure life insurance plans are better than endowment and unit-linked plans (Ulips). If you do not have an insurance cover and would like to save taxes, these should be the first avenues to put your money in. And, you should always buy life insurance early in life if you have dependents. Investment-cum-insurance plans also offer tax saving but due to high costs, these work out more expensive than other market-linked instruments.
Principal repayment: Instead of investing in different instruments that might not be useful for you and your portfolio, you could claim for prepaying and repaying your housing loan. Unfortunately, there is no separate deduction for this purpose.