Top 5 Benefits:Buying Unit Linked insurance plans
Updated On Aug 01, 2021
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They are one of the most popular investment plans in the market since they provide both insurance coverage and investment for your life goals. It is possible to personalise your ULIP plan based on your life goals and risk appetite.
If you prefer to invest in either debt or equity ULIP funds you can do so. Your risk profile will determine how much of your investment is allocated to each instrument if you select for a mixed option. Market linked returns can be obtained using ULIPs. Because of this, ULIPs are an excellent choice for investors who want to maximise their earnings when market conditions are favourable.
Investing and life insurance are combined in some programmes, allowing for greater flexibility and promoting good investment habits. Many different investors can benefit from these programmes, which have varied investing objectives.
Top 5 Benefits of Buying ULIPs
Following are the benefits an investor can unlock by investing in a ULIP Plan -
1. Partial Withdrawal Availability
ULIPs offer partial withdrawal benefits. A particular amount from your reserve can be withdrawn. This provision is often permissible after at least two consecutive years of fruition. This enables you to fulfil unforeseen financial needs without having to turn to your other assets.
2. Switching of funds in a systematic manner
It is possible to switch between funds, such as equities to debt and vice versa, based on market conditions or your investment objectives. You can alter your investment ratio using this option without incurring any additional charges.
ULIPs are deemed easy and transparent compared to other types of insurance plans. In addition to helping you become familiar with your investment funds, ULIPs will also assist you in allocating your funds during the course of the plan. The fact that ULIPs are closely tied to the market makes them more vulnerable
4. Loan Benefits
As a result of unforeseen circumstances, ULIPs allow policyholders to borrow against their policies. Additional perks include cheaper interest rates and a reduction in loan documentation. In the event that you require a large amount of financial support, these plans can be used as collateral for loans.
5. Access to a top-up service
Over and beyond your regular premium contribution, you can make a voluntary extra investment in your ULIP. Your ULIP plan is working well, so adding more money to it makes sense. You don't have to make that extra investment every time you pay your premiums because it's elective.
You will surely view ULIPs for what they are: an investment opportunity once you have a better understanding of them. ULIPs offer a complete package of risk protection, returns, and tax advantages. Given above are a few reasons why you should carefully consider investing in ULIPs.
You may also like to read - Things to Consider While Buying a Unit Linked Insurance Plan
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.