The Unique Features of ULIPs

Unit-Linked Insurance Plans (ULIPs) are a very unique kind of investment plan. In addition to the benefit of wealth appreciation via investment in market-linked securities, a ULIP also provides you the benefit of a life cover which helps you maintain the financial stability of your loved ones when you are not around.

Before buying a policy, whether to invest or to insure, you must study all features of the plan carefully. Familiarise yourself with all that the plan is saying it will offer. This will help you make the best use of them. Since ULIPs are a unique type of plan, check out the following features to see what makes ULIPs unique.

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Unique Features of ULIPS

Following are some of the key features of the Unit-Linked Insurance Plans (ULIPs) - 

1. Dual Nature 

First and foremost, the feature that attracts the most attention for ULIPs is the dual nature of the plan itself. They offer insurance as well as investment components to their investors. The amount of funds you pay for the plan is divided into insurance premium and investment funds. You are then provided with investment units corresponding to your investment amount.

2. Partial Withdrawal Facility

Unlike most pure investment plans, you can withdraw from your funds anytime under a ULIP. If you are short on money then, you immediately do not have to resort to liquidating your assets. Partial withdrawals from your invested amount do not affect your insurance coverage.

3. Choice of Investment Funds

ULIPs are incredibly flexible. You can choose where you want to invest your funds according to the risks you are willing to undertake and the kind of returns you are looking for. The choices usually range between equity, balanced, debt and cash funds. There are also more types available. You can even switch between fund types anytime, generally without extra charges or taxation. Since ULIPs are directly linked to market trends, you must keep an eye on the current trends for a particular fund type when you make a choice.

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Endnotes

As seen from the various factors above, ULIPs are rightly unique and popular. They differ from all plans available on the market and offer benefits like no other plan. To choose the best ULIP for yourself, make sure to browse through various options. InsuranceDekho helps you compare and choose between plans.