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1 860 266 9966

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+91 22 6251 9966

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+91 22 6984 9300

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Need assistance in choosing the right insurance plan? Get a call from our Expert.

Need assistance in choosing the right insurance plan?Get a call from our Expert.

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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. T&C apply.

How To Choose the Best ULIP Plan?

ULIP# or Unit Linked Insurance Plan is an ideal combination of investment and insurance. Good ULIP plans help you meet your long-term financial goals with market-linked investments, along with providing the benefits of a life insurance cover. 
 

A ULIP insurance policy works like a regular insurance policy, and you must make your policy premium payments as per the policy schedule. The best ULIP funds in India come with their unique benefits, features, withdrawal, and premium payment options. 
 

Moreover, ULIPs also provide multiple fund options, and your returns from the plan depend on the funds you select. Therefore, careful consideration is required to choose ULIP plans in India. 
 

For this purpose, here is a detailed explanation of ULIP plans and things you must consider to purchase the best ULIP policy in India. 

What is a ULIP?

ULIP is an integrated monetary product offered by insurance companies in India. It gives you the double benefit of wealth appreciation and security. Under a ULIP plan, you can invest your money in a variety of market-linked qualified funds, which invest it into options like mutual funds, shares, and bonds. 
 

A part of the premium you pay for a ULIP plan is put for providing life cover to the policyholder, while the remaining part is invested in the capital market in debt, equity, and money market instruments in different proportions. Moreover, every fund comes with a risk rating, and you can choose your investment avenue based on your risk appetite.
 

ULIPs have a lock-in period of 5 years, and you have the freedom to make the investment based on your risk appetite. When the policy matures, you get the fund value on the maturity date. 
 

In case of the unfortunate demise of the policyholder, the nominee gets the following amount:

  • Sum assured

  • Fund amount on the date of death

  • 105% of the cumulative premiums paid till the date of death

Tips To Choose the Best ULIP Plan

  • Look for the appropriate amount of life insurance coverage: ULIP insurance plans help you fulfil your long-term financial goals, like your child’s college education, future medical expenses, etc. Additionally, they are designed to provide financial security to your loved ones when you are not around. Therefore, you must choose a ULIP plan with a sufficient life cover amount. 

  • Determine your investment goals before selecting a ULIP plan: Investments help you accomplish your life goals. Therefore, you must outline the essential life goals before investing in a ULIP plan. As stated above, you can invest in debt, equity, or a mix of both under a ULIP plan. 
     

    While equity funds offer a better growth opportunity, debt funds save money. Therefore, you can choose a ULIP plan per your investment needs and risk appetite and switch between funds as these requirements change. 

  • Understand your risk-taking capacity: Since even the best-performing ULIPs in India are market-linked, the risk is their essential component. Higher the risk, the more the return. However, every investor has a different risk-taking capacity. For example, young investors are usually more prepared to take investment risks than people nearing retirement. Therefore, choose a ULIP plan that best fits your risk profile. 
     

    Moreover, ULIP funds offer the option of fund switches, through which you can monitor your investment risk. Know the number of free fund switches you get with the policy so that you can switch between funds depending on your risk capacity and market conditions without having to pay additional charges. 

  • Review the fund’s performance: Before selecting a ULIP plan, study the fund’s performance in which the plan will invest your money. You can observe how consistently the fund has been able to perform during market fluctuations. 
     

    It gives an indication of the fund’s performance and also gives an idea of what you can expect from it in the future. You can also look at the reputation of the insurance company for further assurance. 

  • Know the ULIP charges: The ULIP charges may change for various policies and insurers, but there are some basic charges that are common to almost all ULIP plans. These may include premium allocation charges, fund management charges, policy administration charges, and mortality charges. 
     

    Although these charges may be revised from time to time, enquire about them with the insurer to ensure they are not unreasonably high.

About Tata AIA ULIP Plans

Tata AIA Life Insurance Company offers Unit Linked Insurance Plans that help you create wealth along with providing financial protection to your loved ones. You can choose a ULIP plan with us as per your investment goals, life for wealth creation, retirement planning, child’s education, and health benefits.

Our ULIP solutions offer the following benefits to investors:
 

  • Better returns along with life cover.

  • Multiple fund options to choose from and the facility to switch between funds to cater to the changing market scenarios. 

  • Complete transparency about the ULIP charges and the freedom to choose the funds you want to invest in.

  • Fund management by experts.

  • Facility if partial withdrawal from the ULIP plan after the lock-in period is over. 

  • Tax* deductions on ULIP premiums as per the income tax law. 

  • Hassle-free online and paperless processing for convenience. 

Additionally, you can use a ULIP calculator on the Tata AIA website to know the maturity amount or investment returns you can expect from our ULIP plans. You can compare different ULIPs and select a plan that meets your expectations for the future value of your invested funds.

Wrapping Up

ULIPs are the most popular investment tool, with the dual benefit of security and wealth creation they offer. You can choose a ULIP plan based on your investment goals, the fund’s performance, the sum assured needed, ULIP charges, and your risk appetite.

Get Flexibility to Choose from 10+ Fund Options with our ULIP

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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!

View all posts by Tata AIA Life Insurance

FAQs

Why are ULIPs so popular?

ULIPs offer dual advantages to the investor. You can invest in a ULIP plan to grow your wealth to meet your long-term goals and have a life cover to protect your family at the same time.

Is ULIP better than term insurance?

ULIPs and term insurance are both different types of life insurance. If you are looking for a pure life insurance plan, you can opt for a term plan. On the other hand, if you want investment benefits along with life coverage, you can opt for a ULIP plan. 

Do ULIPs have a lock-in period?

As per the current regulations, the lock-in period for ULIPs is five years. During this period, policyholders are not allowed to surrender or withdraw the funds invested in the ULIP. The lock-in period is designed to encourage long-term investment and to align with the insurance nature of ULIPs.

Disclaimers

  •  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 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.

  • Tax: *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.

  • ULIP#: 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.