Why ULIPs Should Be a Part of your Investment Mix?


In order to accumulate a significant corpus, you need to invest regularly. You should consider a ULIP if you are looking for a long-term investment option.

If you want to understand the benefits of ULIPs, then read this article.

A unit linked insurance plan (ULIP) is a plan that offers the benefit of life cover as well as investment. A part of the premium goes for life cover. The other part of the premium is invested in different investment instruments like debt funds, equity funds, etc. Therefore, a ULIP can provide financial assistance to the policyholder’s family in case of his/her untimely demise. Furthermore, it can help the policyholder build a substantial corpus.

Why You Should Invest in ULIPs

  • Provides Life Cover and Investment Options

When you invest in a ULIP plan, you will get life cover as well as investment benefits. In case you pass away untimely, the insurer will provide your family with the sum assured. Therefore, with the help of a ULIP, you can secure your family’s future. Furthermore, by investing in different investment instruments, you can generate a substantial corpus.

  • You Can Select the Funds

You are allowed to select the funds you want to invest in based on your risk appetite. For example, if you have a high-risk appetite, then you can select equity funds.

  • It Can Help you achieve Long-Term Goals

In order to achieve long-term goals, you will need a lot of money. A unit linked insurance plan can be a good option to accumulate funds.

  • You Can Take Advantage of Top-Up

If you invest in a unit linked insurance plan, then you can increase the investment amount. When you use the top-up facility, you can invest an additional amount in your policy. If your fund is delivering better returns, then by increasing the premium, you can generate more profits.

  • You Can Switch  Between Funds

ULIPs provide you with the benefit of switching between funds. You can switch funds based on your risk appetite. With the help of the switching option, you can increase your returns.

  • Tax Benefits

You can get tax benefits by investing in a ULIP. You can claim a tax rebate on the investment, returns, and withdrawal. If you invest in a unit linked insurance plan, then you can tax benefits under Section 80C and Section 10 (10D). This is one of the most important benefits of ULIPs. The maturity amount is exempted from tax.

  • Can Offer Higher Returns Compared to Other Insurance Products

By investing in a ULIP, you can invest in different funds. Therefore, the amount offered on maturity can be higher compared to other types of insurance plans.

A ULIP provides you with the benefit of life cover. Thus, it can offer financial assistance to your family in case you pass away untimely. Furthermore, it can help you invest in funds in order to increase your profits. Therefore, with the help of a ULIP, you can accumulate a substantial corpus.

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