The life insurance market is becoming cluttered since past few decades. It is the human nature that the need of having more never goes off. People seek different ways of getting more money through several investments. Bearing this in mind, the companies offering life insurance have entered in the savings and investment sector and started providing the life insurance with such provisions. Traditionally, endowment plans were suitable for the people having low risk-appetite. As the demand and risk hunger was grown, insurance companies introduced comparatively high-risk investment plan named ULIP, or Unit Linked Insurance Plan.
A ULIP is a form of life insurance which lets you invest in different market-linked funds and get a sizeable corpus in return at the end of the policy tenure. Since it is the life insurance policy, it’s primary aim is to provide life cover to the insured person. Several benefits of a ULIP can be enlisted as- Flexibility in Fund Management Initially, there are multiple funds available to invest in, and you can choose from them as per your risk appetite. You can select the funds based on your financial needs and future goals. The market is volatile; thus, you can switch between the funds whenever you notice the fluctuation in the market. Partial withdrawal is another flexibility. You can partially withdraw up to 20% of overall the funds once the lock-in period is over. Life Cover Life cover is the primary objective of any life insurance policy. ULIPs also provide guaranteed life coverage that takes care of your family’s future financially. Sizeable Corpus at Maturity You need to understand that the returns on investment are entirely dependent on the market performance. But, as the ULIPs are designed as the long-term investment products, you can anticipate sizeable corpus at the end of the tenure. Short-term investments may or may not offer the anticipated returns; thus, it is always advised to stay invested for a long tenure. Top-Up Provision Once you purchase the policy, the insurer still allows you to add more money to your ULIP, as to let you accrue more amount over the period. Besides all the benefits, like other life insurance policies, ULIPs also offer regular tax benefits on the premiums paid as well as on death and maturity benefits. The tax benefits can be availed under Section 80C and Section 10(10D) of the Income Tax Act. Lastly, ULIPs give you the best when you stay invested for a long tenure. If you are the one seeking the adequate life cover and sizeable corpus at the end, you must go for ULIPs. Get your ULIP, today!
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February 2022
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