Unit-linked investment plans or ULIP is a type of life insurance policy that also provides you with an opportunity to invest and grow your corpus. Thus, ULIPs provide a combination of both Investment and insurance in a single product.
You can even call ULIP a common man’s PMS, because of all the investment features a ULIP offers. But that’s not the only reason why you should invest in a ULIP. ULIPs offer more than just a good investment option.
How to Buy ULIPs?
Like most other financial instruments and investments you can buy ULIP online as well as offline. The online process allows you to complete your application from anywhere in the world. On the other hand, the offline method allows you to have a personal advisor handholding you through the application.
However, nowadays, buying a ULIP online is as easy and smooth as an offline process, including handholding. You can have a qualified advisor guiding you on chat or call, plus there are numerous other benefits of buying ULIPs online.
Benefits of Buying ULIP Online
Online ULIPs are plans that you can purchase through the company’s website. This saves you the trouble of going to your provider’s branch and then purchasing. Buying ULIPs online can give you the following benefits.
1. Buying ULIP Online is Faster
If you decide to purchase ULIP offline, you may have to go through a lot of paperwork. This paperwork involved can be difficult to handle.
Online ULIP’s on the other hand involves minimal paperwork and the process is faster. This is because here you don’t have to personally visit the company, connect with the agents and go through the documentation, you just have to log in to the website.
2. Online ULIPs are More Affordable
When you buy the policy online is more affordable, due to no intermediaries being involved in the process.
a) The fewer middlemen between you and the product the more affordable will it be for you.b) There are no agents involved in the online process.c) When there are no agent fees, the major part of your premium can be invested in the fund selected. d) Policies like Invest 4G allocate 100% of your premium paid to your chosen fund.
3. More Convenient to Buy ULIPs Online
Online facilities of the insurance providers are available to you 24x7. There is no closing time on the web. If you decide to choose an offline policy you can only do that between a specific duration and 5-6 days a week.
But it will be difficult for you if you are working. Here is the point buying ULIP online can help you.
Online ULIP, you can visit the site any time you want when you are free, be it Sunday as well.
4. Full Transparency
Before purchasing the policy online, you can look at the range of options that are provided to you by the company. You can search about insurance plans from different companies and make a decision yourself.
There is no agent involved who might have an agenda and can limit your choices.
5. Contribute to the Environment
Since the process is online, this will help you save paper, as all the steps are performed online. Thus, it also gets beneficial for the environment
How to Buy ULIP Online?
Now that you know why buying ULIP online can be a good option for you, let’s take you to the process involved in purchasing.
1. Log in to the website of the insurance provider
2. Check for parameters such as Claim Settlement Ratio (CSR), additional benefits of the policy such as bonuses, free switches etc.
3. You can calculate your premium for the different features and options you want to have with the policy
4. Enter the details in the application form and upload the listed documents
5. Pay your premium from the various online modes available. You can choose from methods such as
a) Credit cardb) Debit cardc) Net banking, or other payment getaways
6. You may need to go through a medical check-up
7. After your details are verified by the underwriter, the policy will be issued to you
The online process for buying ULIPs is easy, as well as transparent. You get the chance to explore premium changes and benefit scenarios for every feature of the policy before buying.
Why Should you Buy ULIPs?
Apart from offering you death as well as a maturity benefit ULIPs are a great option to invest in due to the following features:
1. Premium Funding Benefit
Policies such as Canara HSBC Oriental Bank of Commerce Life Insurance Invest 4G come with an option of goal protection option.
If you have opted for this feature, upon your death during the policy term:
a) The sum assured will be provided to your family as the death benefitb) The remaining premiums will be funded by the company as if you are alivec) The policy continues as intended till maturity and finally, your family will receive the maturity value
2. Get Covered for Life
ULIPs also provide you with an option to stay covered for as long as 99 years. Century option of Invest 4G from Canara HSBC Oriental Bank of Commerce Life Insurance, will provide you with this facility.
3. Automated Portfolio Management
Various portfolio management strategies are offered that you can choose from. Invest 4G gives you 4 management options. These are
a) Systematic Transfer Optionb) Return Protector Optionc) Auto Funds Rebalancingd) Safety Switch Option
Under these options, things work according to a defined manner. The fund is managed automatically and you don’t have to be much involved.
4. Partial Withdrawals
You can partially withdraw from your fund value at no extra cost after the lock-in period of 5 years has been completed. These can help you a the time when you require quick money These partial withdrawals are tax-free as well.
5. Tax Benefits
ULIPs are eligible for tax saving benefits both at the time of investment and maturity. You can claim deductions of up to Rs 1.5 lakh in a year for the premium you pay for ULIP u/s 80C of the Income Tax Act.
Also, the maturity amount that you receive or the death benefit is can be exempt from tax under section 10(10)D of the Income Tax Act 1961.
6. Use for Retirement and Legacy Goals
ULIP is the only investment option you can use for all the following three goals:
a) Building your retirement corpusb) Drawing a pension from retirement corpusc) Leaving a legacy for the next generation
Invest 4G’s 99-year holding option allows you to not only build a huge retirement corpus but also turn it into a pension after 60. Similarly, the plan will ultimately pay the death benefit to your family.