UNIT LINKED INSURANCE PLAN
Combination of investment and insurance, ULIPs (Unit Linked Insurance Plans) provide you with the best of both spheres. Thus, you will get both life insurance as well as investment options when you will choose ULIPs. Most of the ULIPs have a lock-in period of 5 years, thus it can be considered as a long-term investment strategy. The policy holder has the option to invest his money in equity or debt & also he can do switches amongst the same. The insurance companies regularly publish the full portfolio of each scheme where they have invested the funds. They declare the NAV on daily basis. The customer has the choice of selecting the premium as well as the insurance coverage on a specified premium i.e. he can take more insurance at a specified premium if his main purpose is insurance & he can take less insurance if his main purpose is returns.However, one must check out the risk appetite and various risk factors before purchasing a plan. It is because there is also a risk of low returns and everything primarily depends upon the market’s performance.