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ULIP Vs. Money Back Plans

Published On Aug 24, 2021

A ULIP is a combination of an insurance policy and a financial investment. The policy stipulates a death benefit, which is the amount paid to the nominee if the policyholder dies within the policy's term. In addition, if the policyholder lives to the end of the ULIP's term, he or she will get the ULIP's maturity value.

Whereas, in a money back plan, instead of receiving the lump sum amount at the conclusion of the term, the insured individual receives a proportion of the sum assured at regular intervals in a money back plan. It's an endowment plan with a liquidity component.

Benefits Of Money Back Plans

Money back plans offer various benefits that comfortably lets you invest, save and grow money for your future such as -

  • Survival Benefit

When the life assured manages to survive the entire duration of the policy term, they are provided with the sum assured along with simple reversionary bonuses and any applicable final additional bonuses under the name “Survival Benefit”.

  • Death Benefit

When the life assured happens to unfortunately pass away due to any unforeseen accident or event while the policy is in full force, provided all the premiums are paid successfully without any due, the nominee or the beneficiary of the policy will receive the sum assured on death and any applicable bonuses so that they do not have to worry about the financial hardships.

  • Maturity Benefit

When the money back plans reach their maturity age and the life assured manages to survive the milestone, they are provided with a payment of the sum assured along with simple reversionary bonuses and any applicable bonuses.

Must read: When is The Right Time to Purchase Money-Back Plans?    

Benefits Of Unit-Linked Insurance Plans (ULIPs)

ULIPs offer many benefits that are beneficial for investing effectively like the following -

  • Flexibility

ULIPs provide a variety of high, medium, and low-risk investing possibilities through various funds within the same plan. You can select a suitable plan based on your risk tolerance.

ULIPs give you the option of choosing the sum assured or premium based on your needs.

  • High Returns

Because ULIPs provide a variety of investment funds, some of these investment funds are equity-based and provide substantial returns over time. 

In the event of unanticipated future circumstances, ULIPs also allow you to make a partial withdrawal; you can take cash from your Unit Linked Insurance Plans after the first 5 years.

  • Transparency

Before you acquire a product, you'll learn about the charge structure, the value of an investment, and the predicted rate of return over the policy's entire term. It's usually a good idea to learn about the product into which you'll be investing your hard-earned cash.


In conclusion, money back plans offer you benefits like survival, death, maturity, and more while ULIPs offer you flexibility, high returns, transparency, and other benefits. Different plans offer different benefits and hence you must compare different plans and pick a plan that offers you the benefits that you require to fulfill your future goals.

Also read:

Which Riders are Suitable for Money-Back Plans?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.


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