Outlook Money
A Unit-linked insurance plan (Ulip) is a financial product that combines life insurance cover with market-linked investments under a single policy.
When a premium is paid, one portion goes towards insurance coverage while the remaining amount is invested in market-linked funds.
Ulip investors can choose between equity, debt or balanced funds depending on their financial goals, investment preferences and risk tolerance.
The value of investment in Ulips depends on market performance. Fund values can increase or decrease based on movements in the financial markets.
The value of investment in Ulips depends on market performance. Fund values can increase or decrease based on movements in the financial markets.
Ulips may include mortality charges, fund management charges, policy administration charges and premium allocation charges, depending on the policy.
Charges are deducted from premiums and fund values. These deductions affect the amount available for investment within the policy.
Ulips generally allow fund switching, top-up investments and partial withdrawals after the lock-in period, subject to policy conditions.
Ulips come with a mandatory five-year lock-in period. Early exits and withdrawals are restricted during this period under regulations.