Unit Linked Plans (ULIP) in India

ULIP in India are on the top in the popularity chart because it offers more benefits than traditional life insurance plans. There are many benefits are available such as higher returns on investment, partial withdrawal, flexibility to choose life cover, wider fund options, top up facility, free switches, tax benefits, etc.
If you are looking for long term investment and better returns, ULIP is a right option to achieve your goal. But, you may find difficulties while purchasing the ULIP, because there are single and regular premium option. You have to choose the right option for you.
In single premium ULIP, you need to pay a single payment and you will enjoy the benefits throughout the policy term. In case of regular premium, you need to pay premium on regular basis, it can be paid by annual, half annual, quarterly and monthly mode.
In terms of investment, both products offers similar options like equity, debt and liquid. Under regular premium option you may ask for commitment to pay more. But, under single premium product nobody will ask you to pay more as a matter of commitment.
In the initial years of ULIP, single premium product offer better returns than regular premium product. But, it’s balance power shifts down latter. But this is not in effect, the product is sold very aggressively due to IRDA norms. Regular premium ULIP products are also good in various factors such as affordability, tax benefit and large return.
There are also ULIP charges to consider than single and regular premium. It is also important to take a overview of different charges are under ULIP plans. It includes premium allocation charge, risk cover charges, policy administration charges, fund management charges, service tax charge, miscellaneous charge, etc.
At the end, ULIP is a good mixture of life cover and investment. But don’t buy it for investment purpose only, there are another good options available for the investment. Unit linked insurance plan (ULIP) is a life insurance solution that provides the client with the benefits of protection and flexibility in investment. It is a solution which provides for life insurance where the policy value at any time varies according to the value of the underlying assets at the time .
The investment is denoted as unit and is represented by the value that it has attained called as Net Asset Value (NAV). ULIP came into play in 1960s and became very popular in Western Europe and America. The reason that is attributed to the wide spread popularity of ULIP is because of the transparency and the flexibility which it offers to the clients.
As time progressed the plans were also successfully mapped along with life insurance needs to retirement planning.In today’s times ULIP provides solution for all the needs of a client like insurance planning, financial needs, financial planning for children’s future and retirement planning.