Insurance has been an instrument of risk mitigation, an avenue of investment, and a means to save tax for a long time. Major insurers in India have started offering investment plans that allow policyholders to determine their risk appetite in their policies. This type of hybrid investment-cum-insurance plan is called Unit Linked Insurance Plansor ULIP.
Be it life or investment, flexibility is a crucial feature to possess. Flexibility aids in tackling and adapting to changing scenarios and situations
You can adjust and minimise your losses if you manage to stay flexible. Unit Linked Insurance Plan’s ability to be flexible allows them to be one of the safest yet most versatile investments of all time.
What is investment flexibility in Unit Linked Insurance Plans?
Unit Linked Insurance Plans, also known as ULIPs, are one of the most flexible investment plans. If you want to rely on a plan to achieve all your financial goals in the long run, then you can choose to invest in a Unit Linked Insurance Plan.
Whether you want to invest in order to accumulate wealth over time or save for your retirement, ULIP can help you achieve your dreams, all thanks to its flexibility.
Understanding the flexibility concept in depth.
- a) Select the Asset Class
- b) Fund allocation
- c) Select the premium payment term
- d) Receivable Benefits
- e) Systematic Withdrawals
1. Freedom to select the funds
Almost all the investment instruments choose to invest in one to two assets without giving you the freedom to select the funds you want to invest in. ULIP plans, change the game. They offer you the freedom to invest in a wide range of asset classes.
Asset classes available:
– Balanced Funds
– Liquid Funds
Throughout the term of your ULIP plan, you have complete freedom to choose any of these asset classes.
2. Fund Allocation
With your ULIP plan, you not only get to choose which fund to invest in, but you also get the freedom to choose more than one fund! Not only that, but you also get the freedom to allocate your money as per your choice.
You can allocate different portions of your premium to different funds. For example, you can allocate 40% to equity and 60% to debt.
3. Choose the premium payment term
The period for which you must pay your premiums is called as premium payment term. With ULIPs, you can enjoy various ways to make your premium payments.
You have the freedom to select one of the options-
– Regular Payment Mode
- a) Monthly
- b) Quarterly
- c) Yearly
– Limited Payment Mode
– Single-Premium Payment Mode
4. Receivable Benefits
There are two benefits available in the ULIP plan.
– Maturity Benefit
– Death Benefit
While almost all the investments available in the market offer these benefits in lumpsum, with ULIP, you can choose to receive these benefits in lumpsum or instalments.
Click here to learn more about What are the Maturity benefits in a ULIP Plan?
5. Systematic Withdrawal
ULIP plan allows you to withdraw your invested money partially even before the policy matures. However, you must note that you can only withdraw our funds after the lock-in period of five years and only after you turn 18 years old.
The flexibility that this policy offers has made it a popular investment option. Invest in ULIPs according to your investment objectives and achieve your goals.
Visit here to know more about Unit Linked Insurance Plan: https://www.kotaklife.com/online-plans/ulip-plan