ULIP is a blessing for investors that helps to make long term Investments for lifetime goals. ULIP or a Unit linked insurance plan is an investment approach that creates multifaceted investment options for investors with an intent to cover expenses in the policy for 10 years for better chances for higher returns.
The ULIP product that are managed to complete a specified objective. With its flexibility in investment and high ratio coverage, it becomes very popular for the investors to exposing the equity or bonds.
In this article, we’ll discuss about the nuances of policy investors making ULIP product.
Key features of Unit Linked Insurance Plans:-
- Long-term Premium:
The regular premium helps the investors to create a strong corpus, which lets the beneficiaries receive the payments after the owner’s death.
It’s a kind of mutual fund that gives you flexibility to choose the equity fund you want to invest in. The premium covers life insurance, education or retirement payments based on the premium payment frequency you choose (monthly, half-yearly, upfront, lump sum payment, recurring payments, etc.)
Based on regular payment you are directed towards the withdrawal. The number of withdrawals you are permitted to do is based on premium payments.
- Additional payments
Another unique feature of ULIP is that you have the flexibility of doing top up payments that can increase the investment over the time leading your returns to the larger at the end. There are also multiple options, which if you do you can have a single payment copiously with interest at the end of the tenure.
- Tax options
Building a strong stock portfolio in your life can make you achieve your investment goals with cumulative returns. Tax exemptions under ULIP under section 10 (10D) of premiums are upto 1.5 lakh per annum.