When your financial needs change, you should look for a solution that provides both liquidity and protection. You should consider investing in a financial product that combines the two aspects of your finances into one, with flexible benefits. A ULIP plan is a type of Investment With Multiple Benefits that offers the dual benefit of insurance protection as well as growth on the capital. They are way better than bank FDs because the former provide you with more options to grow your money. In recent years, ULIP plans have become a major investment vehicle because they offer a lot of functionality. This article talks about the various benefits of investing in Unit Linked Insurance Plans in India:
What Exactly Are ULIPs, Investment With Multiple Benefits?
ULIPs have emerged as a popular investment choice because they offer dual benefits: an insurance policy and a low-risk investment for your future. You can customize your investment based on what you can afford and how much risk you’re willing to take.
You can even decide which funds to invest in with options like debt- and equity-related instruments. If you pick a mixed option, you can also decide how much of it will be dedicated to investing in either instrument, depending on your risk profile.
Benefits of Unit Linked Insurance Plans
Life Protection, Savings, and Investment
Investing in ULIPs can help you build habits like saving and investing, which are good for your long-term financial health. It offers a way to get life insurance and investments in one package that provides you complete peace of mind for your future.
In a ULIP plan, a part of the premium goes into funds, which earn interest from its debt and equity investments. This allows them to earn returns based on the market and with useful data such as ULIP Nav, you can ensure that your investments are aligned properly with your financial goals.
A ULIP plan allows you to pay premiums for some time to receive a lump sum or regular payments from the insurance company if you pass away within that term. In unit-linked plan, the death benefits are calculated as part of the surrender value together with the value of your investments. However, these benefits may differ based on whether you die from an accident or a natural cause.
A ULIP plan usually comes with maturity benefits if you can endure the maturity period of your policy. In this case, the maturity benefits are usually the sum of the value of the fund plus some extra benefits. Normally, maturity benefits come as a lump sum payment, but some insurance companies may offer an additional payout.
Long-term Investment Benefits
ULIP plans are a long-term investment instrument that helps you earn maximum returns if you can stay invested for a longer period. If you invest for the long-term, your returns will eventually reflect the market trend, but if you invest for the short-term, then your returns are likely to be affected by fluctuations in the market.
Free Look-in Period
Most of the insurance policies, including ULIPs come with a free look-in period. If you are not satisfied with your life insurance policy within 15 days of buying it, you can cancel it and get all your money back.
Best ULIP Plans in India
LIC New Endowment Plus
If you’re interested in a non-participating endowment policy, then the LIC New Endowment Plus might be a good choice. It’s a type of investment that offers you a variety of fund options and the ability to choose how much your initial payment is.
If you die before the policy ends, your beneficiaries will receive an amount equal to the value of that fund. At maturity, you will also receive the value of your investment plus any applicable interest. You may also be able to claim a tax deduction on your premiums as per the mandates of ITA.
Canara HSBC Oriental Bank Of Commerce Invest 4G
This is a unit-linked plan that allows you to invest as per your goals. With the flexibility to change the composition of your portfolio, this plan gives you complete control over your savings. It can also provide life insurance coverage in the event of your unfortunate demise.
With this plan, you can decide whether to pay for the entire policy term or limited years or only once. Mortality Charges will be added to the Fund Value at maturity. There are three different cover options available for you to choose from.
HDFC Life ProGrowth Plus
HDFC Life ProGrowth Plus is a unit-linked insurance and regular premium plan where the premium is invested in the market. The plan offers the flexibility to choose investment funds as per your risk-taking capabilities and financial requirements.
It also has a convenient payment system and multiple access modes, such as credit cards, cheques, internet banking, and an auto-debit facility. Moreover, the plan also allows you to invest based on your investment strategy.
HDFC Life Click 2 Wealth
HDFC Life Click 2 Wealth is a non-participating unit-linked life insurance plan. It offers market-linked returns and provides financial protection for you and your family at affordable prices. The plan gives a 1% boost to policyholders’ fund values and you can choose from 10 investment fund options.
You can also freely switch between them at your convenience. The plan even offers added flexibility in terms of premium payments through options like single, limited, and regular payments that make it one of the best ULIP plans in India.
In this article, we have highlighted the benefits of ULIPs and how they can help you meet your current as well as long-term financial goals. It’s hard to go wrong with ULIPs if you’re looking for an investment that provides insurance coverage and capital gains. We hope this article has provided you with some helpful insight into the benefits of ULIPs and how they can help you in multiple ways.