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Why Do Wise Investors Choose ULIP Plans?

24-June-2021 |

 

The ever-changing global scenario poses several uncertainties in our lives. Whether in economic conditions or in our health and lifestyle, emerging circumstances have taught us important lessons.

So, what is the greatest preparation to meet these challenges? Is it substantial financial stability to overcome dislocations? The answer is certainly a big yes! The key here is therefore to invest money. And, the right financial instrument will make a much-felt difference.

What are the best choices? You would have heard that wise investors opt for the ULIP plan? So, what is the ULIP policy, and why do investors prefer investing in ULIP? Let us get ahead and understand the plan better.

 

What is a ULIP Plan?
 

A Unit Linked Insurance Plan(ULIP) is an insurance plan that provides dual benefits for the investors: market-linked investments and life insurance. It is considered one of the best comprehensive life insurance policies due to its extended benefits. One portion of the premium is used as a life cover, and the other is invested in the financial markets. So, you get market-linked returns for the premium component that is invested. In addition, many flexible features of the ULIP policy help you customise the policy for your individual needs. Let us understand more about ULIP plans.

 

What are the Features of a ULIP Plan? 


ULIP insurance is considered an option for wise investors due to its distinct features:

 

  1. Dual benefits - The ULIP policy provides a life cover that ensures a lump sum death benefit to the nominee in case of your unexpected death. In addition, a part of the premium invested in the securities market will provide returns based on the fund value.

  2. Rider# benefits - The add-on rider# benefits will extend the benefits of the life cover insurance policy. There are different insurance riders# options such as the total and permanent disability rider#, terminal illness rider#, accidental death benefit rider#, critical illness rider# etc. These rider# options provide financial support based on the situation by making the insured amount payable during the policy term. For example, the critical illness rider# will provide you with the fund for helping you pay for the medical expenses when you are diagnosed with a critical illness for the first time in your life.

  3. Investment options - Insurers provide different types of funds that you can invest in based on your risk appetite. For example, you can choose the equity funds for high risk, hybrid funds with equity and debt combination for moderate-risk and debt funds for low risk. The higher the risk you take, the better are the returns.

  4. Fund switching options - ULIP policy provides the option to switch between the funds during the policy term based on the market volatility and the fund performance. For example, if you have chosen an equity fund option and find it not performing well, you can switch to a debt fund to secure your investments.

  5. Lock-in period - The ULIP policy provides a lock-in period of five years. It means partial withdrawal from the fund is allowed only after five years. It is considered a good feature because it encourages and helps people develop the financial discipline of staying invested for the best returns in the longer term. 

 
Why do Wise Investors Choose ULIP Plans?
 

Having read about the basic features of the ULIP plan, let us try to understand why wise investors opt for the ULIP policy.

 

  1. Flexibility - Choosing between the funds based on your risk appetite and the market volatility ensures a secure investment option. This flexibility will provide consistent ULIP returns when you utilise the feature wisely.

  2. Long term benefit - The ULIP policy has a lock-in period of 5 years which ensures that you stay invested in the long term for higher returns.

  3. Ensuring family's financial security - With the ULIP policy, you get the benefit of investing and ensuring financial protection for your family in your absence simultaneously. You can decide the premium based on your family's financial commitments in the long term, such as your child's higher education, marriage etc.

  4. Tax* benefits - Wise investors can also seek tax* benefits from the ULIP investment. The premium amount paid and the returns qualify for a tax* deduction and tax* exemption under the Income Tax Act, 1969.

  5. Flexible premium payments - Based on your steady flow income, you can choose to invest in the plan as a lump sum amount or as regular monthly payments. You can limit the period for the payment while staying insured. 

 

Tata AIA Life Insurance Fortune Pro ULIP Plan (UIN- 110L112V04)

 

Tata AIA Life Insurance Fortune Pro (UIN- 110L112V04) is a ULIP that ensures the growth of an investment based on market-linked returns. This Tata AIA insurance plan offers 11 fund options. You have the flexibility to choose between the funds according to your investment needs. You can also opt for a systematic investment plan through an enhanced portfolio strategy. The premium amount can be paid as a lump sum amount or for a limited period. The plan also offers coverage up to the age of 75 years.

 

Conclusion
 

The ULIP plan is a comprehensive life insurance policy that provides dual benefits, insurance and investment along with life insurance protection. It is a preferred option for many wise investors because it offers unique features that secure your investment and help you earn higher returns. You can choose the funds to invest in based on your risk tolerance level and switch between the funds if there is a market fluctuation. The ULIP plan also helps you invest in the long term for better returns. Therefore, opt to invest in ULIP for insurance and investment benefits. Choose the best fund and stay invested!

 

L&C/Advt/2021/Dec/2213

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Need more information?
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TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.

Looking to get a new plan? 
Connect with us now

+91

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.

People Like You Also Read

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Read More
11 ULIP Charges That You Should Know About
Read More
Everything you Need to Know About Premium Redirection in ULIPs
Read More
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Tata AIA Life Insurance

A joint venture between Tata Sons Pvt. Ltd. and AIA Group Ltd. (AIA),  Tata AIA Life Insurance  is one of the leading life insurance providers in India. We post everything you need to know about life insurance, tax savings and a variety of lateral topics such as savings and investments in this space. You can access and read a host of different blogs, articles and pages at the Tata AIA Life Insurance Knowledge Center or get in touch with us with any queries or questions!

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Disclaimer
  • Insurance cover is available under the product.

  • The products are underwritten by Tata AIA Life Insurance Company Ltd.

  • The plans are not a guaranteed issuance plan, and it will be subject to Company’s underwriting and acceptance.

  • For more details on risk factors, terms and conditions please read the sales brochure carefully before concluding a sale.

  • This blog is for information and illustrative purposes only and does not purport to any financial or investment services and do not offer or form part of any offer or recommendation. The information is not and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.

  • Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company.

  • Every effort is made to ensure that all information contained in this blog is accurate at the date of publication, however, the Tata AIA Life shall not have any liability for any damages of any kind (including but not limited to errors and omissions) whatsoever relating to this material.

  • * Income Tax benefits would be available as per the prevailing income tax laws, subject to fulfilment of conditions stipulated therein. Income Tax laws are subject to change from time to time. Tata AIA Life Insurance Company Ltd. does not assume responsibility on tax implications mentioned anywhere in this document. Please consult your own tax consultant to know the tax benefits available to you.

  • #Rider is not mandatory and is available for a nominal extra cost. For more details on benefits, premiums, and exclusions under the Rider, please contact Tata AIA Life's Insurance Advisor/ branch

  • IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER

  • THE LINKED INSURANCE PRODUCT DO NOT OFFER ANY LIQUIDITY DURING THE FIRST FIVE YEARS OF THE CONTRACT. THE POLICY HOLDER WILL NOT BE ABLE TO SURRENDER/WITHDRAW THE MONIES INVESTED IN LINKED INSURANCE PRODUCTS COMPLETELY OR PARTIALLY TILL THE END OF THE FIFTH YEAR.

  • Past performance is not indicative of future performance.

  • All investments made by the Company are subject to market risks. The Company does not guarantee any assured returns. The investment income and price may go down as well as up depending on several factors influencing the market.

  • Please make your own independent decision after consulting your financial or other professional advisor.

Need more information?
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TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.

Looking to get a new plan? 
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TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.