What is a ULIP?
A ULIP – unit linked insurance plan is a comprehensive insurance plan as well as an investment plan that makes the individual taking it up, an insurance policy holder as well as an investor. The unit linked insurance plan has really high returns as the funds are invested so that the capital gains appreciation. Insurance policy cover and return on investments, both are what the plan holder are subjected to getting. It is one of the most beneficial plans as it is a two – in – one plan which gives additional benefits compared to any other type of plans. The unit linked insurance plan has really high return on its investment.
A potential policy holder might be inclined towards taking up this insurance policy as this would give them double the benefits by paying for only one. This is because the premiums are considered as the funds for investments. The ulip is a low risk insurance policy as the premiums of the insurance plan policy are treated like the investments and has really high transparency in terms of where their funds are being allocated and invested. The investors or the insurance policy holders are fully aware of where their money is being invested. The insured of the plan has an option in which they are able to check the status of the investments that they have made through the NAV – Net Asset Value.
Knowing about the funds helps the investors know how much risk the investment possesses. This allows them to study and analyze the markets to see if the funds market where their funds have been invested could be risky or not and when will it be the most beneficial to take their money out. It also allows them to see how much profits or risks it has been having in the past few years and how good it will do to them and helps them to anticipate any profits or losses.
The unit linked insurance plan helps the investor to accumulate or accrue a large sum of money with low risks so that they can fulfil their future needs and save a good amount of money for their family.
How useful is a ULIP?
ULIPs – unit linked insurance plans have many purposes, uses and benefits attached to them. One of the biggest benefits of a ULIP – unit linked insurance plan is that it completely eliminates the hassle of taking up and maintaining an insurance plan as well as an investment plan as the ULIP provides the investor or the insured with the benefits of both under the umbrella of one plan which uses the premiums of the insurance policy as funds for investment and invested the policy holder’s money into fund markets.
- Useful in corpus building
It is better to put your money into a plan instead of it just lying around and not appreciating in value. ULIP – unit linked insurance plans are a great source of building a good corpus for the future. A corpus can be built over a period of time which can be used later for fulfilling any requirements or wants. Getting a regular investment plan might be much riskier than a unit linked insurance plan as you would have to invest the money and wait for it to grow, but in a unit linked insurance plan your premiums are treated as the funds that have to be invested. You do not even have to pay two types of amount for the insurance and the investments, separately. The ULIP – unit linked insurance plan will take the premium that the policy holders pay in order to get a comprehensive cover for their claims as the investments that will be used for investing into the funds. Either the entire amount of the premiums is taken or only a part of the premiums are taken to be invested into the funds in order to raise the capital and appreciate it so that the policy holder, who is also the investor, gets a good return on their investments.
- Fulfilment of future goals
The ULIP – unit linked insurance plan helps you meet your future requirements or goals like the education of your child, your higher education, the setting up of a business that requires capital, setting up a fund for your child, setting up money for your spouse who is dependent, saving money to buy a house, saving up money to invest into property or anything else that you desire, etc. Investing into ULIP – unit linked insurance plans can help you achieve your dreams and future goals through the appreciation of the capital that you put in as premiums for the insurance plan which is used as funds for the investment plan making it in pen with two nibs. It helps a great deal in saving up for the education of your child. In case of your unfortunate death, your child, who might be dependent, is left alone in this finance crazy world and has to look after themselves, here, the ULIP – unit linked insurance plan comes in handy as it will save a corpus amount of money for your child to use in their time of need or for their education and the death benefits that the insurance plan part of the ULIP – unit linked insurance plan will give will also cover for the daily functioning of the dependent(s). Saving up for your child might be the central purpose of taking up the ULIP – unit linked insurance plan as it really does help in building up a good corpus over the years.
The ULIP – unit linked insurance plan is a really beneficial insurance plans as well as an investment plan with good returns. So, invest into the best ULIPs in accordance with the requirements and want of you as well as your family.