When you want to keep your savings and protection needs in one place, a unit-linked insurance plan (Ulip) is the investment option that you may consider investing in. Ulips is a financial instrument that plays its role in creating wealth for achieving the long term goals and also providing protection against any untimely demise of the bread earner of the family. A Ulip is essentially a bundled investment that combines a life cover with an investment plan. It best suits an investor who is not able to keep protection and investment needs separate.
Unlike in endowment plans, in Ulips for a particular annual premium amount, you can decide how much insurance you want, within a certain range. After costs for insuring you for that amount are deducted, the rest of the funds are invested.
Of the premium paid, a part of the premium goes towards the mortality charges, that is, the cost of buying a life cover. The premium paid by you, less any charges to be deducted, is used to buy units in the fund selected by you at that day’s unit price, or NAV. The rest, and after deducting costs, gets invested in different fund options where the choices range from 100 per cent debt market products to 100 per cent equity, with varying mixes of both in between.
If you survive the policy term, you get an amount equal to the number of units you hold multiplied by its NAV, which is the fund value. The NAV depends on the performance of the corpus that the insurance company manages, just as it is for a mutual fund. In case of death of the policyholder, the nominee gets either, the higher of the sum assured and fund value, or, both.
Denne historien er fra March 2022-utgaven av Investors India.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent ? Logg på
Denne historien er fra March 2022-utgaven av Investors India.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent? Logg på
ASK THE EXPERT
Ques. One of my friends told me that your company provides detailed Retirement plans. I want to know what is the procedure to get my Retirement plan. I will be retiring in March 2025. R.P Gupta, Noida
How to Naturally Reverse Fatty Liver Disease
The liver, located on the upper-right side of the abdomen, is the body’s largest internal organ and plays a critical role in detoxifying the blood and processing nutrients.
Banking sector which has underperformed in the last two years, now offers a favorable risk-reward profile
Do you think the market is overpriced? Is yes, should investors refrain from investing in index schemes at the current valuation?
India will continue to enjoy benefits of a close US relationship and trade will continue to grow
Q1. The US elections are said to be one of the closest till date, what impact will the election of a Republican / Democratic party have on the US economy and how is that going to affect India in the short as well as the long term?
Understanding Momentum Funds
Momentum funds are a type of investment fund that focuses on companies experiencing positive momentum in factors such as earnings, revenue, and stock price movement.
Risks and opportunities associated with Small Caps
Small-caps are a stock-picker’s paradise.
How to navigate your portfolio through bull market a
Indian equities have been in a bull run for the past four years.
Choosing mutual fund schemes depending on your age to achieve life goals
The choice of mutual fund (MF) scheme might be influenced by one’s risk profile or age.
Thematic Fund Or Sectoral Fund, Which Fund Suits You?
A thematic fund is a type of mutual fund that focuses on investing in companies based on specific themes or trends.
Be Kind To Your Kidneys
The kidney is a vital organ in our body which is four inches long and two and a half inches in width.
