Written by : Knowledge Centre Team
2026-02-27
890 Views
6 minutes read
Share
Unit-Linked Insurance Plans are quite flexible when it comes to accepting and managing investments. You can invest in ULIPs is a mode most convenient to you, and you can invest in a portfolio most suited to your risk profile.
ULIP investment plans are suited for both safe investors seeking stable growth and risky investors looking for market-linked returns. If you are one of the aggressive investors looking to invest in equity funds and want to use the SIP mode of investment, ULIP has the solution for you.
Rupee Cost Averaging (RCA) in ULIP
The distinct advantage of SIP mode of investing in equity funds is the rupee cost averaging. But can you create SIP to an equity fund in ULIP plans? Yes, you can. In fact, there is more than one way of creating rupee cost averaging In ULIP plans:
- Paying premiums in monthly mode
- Using Systematic Transfer option
RCA by Paying Monthly Premium
When you start investing in a ULIP plan you can choose to allocate your invested money into different fund options, including equity funds. Thus, your premium automatically creates a systematic investment plan to an equity fund, which in turn creates the rupee cost averaging for you.
Using Systematic Transfer Option (STO) for RCA
You can use the systematic transfer option available in online ULIP plans like Promise4Growth Plus from Canara HSBC Life Inusrance , in case you want to invest in any other modes than monthly. Systematic transfer option ensures that your money is invested safely and then transferred systematically to the selected equity fund in monthly SIP mode.
The only difference would be that even your parked money will keep on growing. Thus, instead of investing a fixed amount to the equity fund, the ULIP’s STO liquidates the total number of units in equal monthly parts. At the time of transfer, the ULIP will liquidate one part of units and invest the money into the equity fund.
For example, you want to invest Rs. 1 lakh a year in a ULIP plan and want to use the rupee cost averaging advantage as well. The entire investible premium will be first invested in a liquid fund, and then transferred to the selected equity fund in the following manner:
| Month | Liquid Fund Unit Price | Unit Balance | Transferred Units | SIP to Equity Fund |
|---|---|---|---|---|
| 1 | 10 | 10,000.00 | 833.33 | 8,333.33 |
| 2 | 10.1 | 9,166.67 | 833.33 | 8,416.67 |
| 3 | 10.1 | 8,333.33 | 833.33 | 8,416.67 |
| 4 | 10.15 | 7,500.00 | 833.33 | 8,458.33 |
| 5 | 10.25 | 6,666.67 | 833.33 | 8,541.67 |
| 6 | 10.25 | 5,833.33 | 833.33 | 8,541.67 |
| 7 | 10.3 | 5,000.00 | 833.33 | 8,583.33 |
| 8 | 10.4 | 4,166.67 | 833.33 | 8,666.67 |
| 9 | 10.4 | 3,333.33 | 833.33 | 8,666.67 |
| 10 | 10.5 | 2,500.00 | 833.33 | 8,750.00 |
| 11 | 10.6 | 1,666.67 | 833.33 | 8,833.33 |
| 12 | 10.65 | 833.33 | 833.33 | 8,875.00 |
Table 1: Figures in the table does not account for the regular or initial expenses on the policy
As you can see in Table 1, your SIP amount to the equity fund keeps growing with the growth in a liquid fund. However, since the growth in liquid fund NAVs is usually nominal, this increment does not affect the rupee cost advantage much.
Although, if you invest in monthly mode, your monthly instalment into the equity fund will be exactly the same. The systematic transfer option is better than investing your annual premium directly into the equity fund.
Safeguarding Your Corpus from Equity Investment in ULIPs
While SIPs and rupee cost averaging do reduce your risk of investing in equity markets, your entire portfolio still remains in an equity fund. Thus, as you approach closer to your financial goal, you can change your strategy to start a reverse transfer.
At the beginning of the investment, you had transferred the funds from liquid fund to equity fund systematically. Withdrawing from the equity market should also be a disciplined systematic approach. Instead of withdrawing your entire equity portfolio in one instance, let your portfolio subside over time.
Promise4Growth plus offers an automatic portfolio management option specifically for this purpose – safety switch option.
If you select safety switch option in your Promise4Growth Plus ULIP investment, the plan will automatically start moving your equity fund units to liquid fund. However, this movement happens over a period of four years, in the same manner as STO.
So, in the last four policy years, the fund will stop investing any new funds into equity. It will only move the existing equity corpus to liquid fund. Any new premiums will also go to the liquid fund and stay only there.
The purpose of this strategy is to safeguard your accumulated wealth from market risks when you are too close to your financial goal.
Get a Personalised ULIP Plan for Wealth Creation & Protection
Enter OTP
An OTP has been sent to your mobile number
Didn’t receive OTP?
Application Status
Name
Date of Birth
Plan Name
Status
Unclaimed Amount of the Policyholder as on
Name of the policy holder
Policy No.
Address of the Policyholder as per records
Unclaimed Amount
Sorry ! No records Found
Request Registered
Thank You for submitting the response, will get back with you.
Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
Recent Blogs
Is ULIP a Good Investment for Short-Term Gains?
09 July '26
2202 Views
7 minute read
Discover whether ULIPs are suitable for short-term investment goals and understand the risks, returns and lock-in period.
Read More
Ulip
When Is the Right Time to Invest in ULIPs?
29 June '26
897 Views
8 minute read
When is the right time to invest in ULIP? Learn how timing, goals, and market conditions impact returns and why starting early can maximise long-term benefits.
Read More
Ulip
How Do Top-Ups Work in ULIPs? Benefits & Key Considerations
29 June '26
900 Views
6 minute read
What is a top-up premium in ULIP? Learn how ULIP top-ups work, their benefits, and how additional investments can help boost long-term returns.
Read More
Ulip
Professional vs. Retail Investors: How Do They Structure Their Portfolios Differently?
29 June '26
135 Views
4 minute read
Discover how retail and professional investors differ in strategy, risk, and portfolio structure. Learn which approach suits your investment goals.
Read More
Ulip
ULIP Tax Benefits Explained: Save Tax Under 80C
29 June '26
2769 Views
10 minute read
Find out why ULIPs are an excellent way to save money on taxes. Gain tax advantages, market-linked returns, and life insurance while accumulating long-term wealth.
Read More
Ulip
Best Retirement Plan at 30s & 40s: How to Start Early
29 June '26
2761 Views
10 minute read
Learn how to plan for retirement at 30 or 40. Explore the best retirement plans, investment strategies, and tips to secure long-term financial stability.
Read More
Ulip
ULIP Structure Explained: Funds, Charges & How It Works
29 June '26
2770 Views
10 minute read
Comprehend the structure of a ULIP. Find out about charges, fund options, life insurance, premium allocation, and how ULIPs integrate investment and insurance.
Read More
Ulip
GST on ULIP: Rates, Charges & Impact on Premiums
29 June '26
3682 Views
7 minute read
Understand how GST applies to ULIP charges, premiums, and withdrawals. Simple explanation for policyholders to know what they pay and why it matters.
Read More
Ulip
Best ULIP Plans: How to Choose the Right Plan for You?
25 June '26
1080 Views
7 minute read
Choosing the right ULIP plan can make a significant difference to your returns. A clear breakdown of top tips to pick the best ULIP plan for your goals.
Read More
Ulip
Unit Linked Insurance Plans - Top Selling Plans
Canara HSBC Life Insurance offers online ULIP plans that blend life insurance protection with investment growth, helping you build wealth while securing your family's future.
Wealth Today, Protection Always
Promise4Growth Plus
- Life Cover up to 100 Years
- 13 Fund Options
- Fund Switching Option
- Waiver Of Premium
Secure Your Future with Confidence
SecureInvest
- Life Cover up to 100× Annual Premium
- 12 Fund Choices
- Automated Portfolio Strategies
- Maturity Booster
Invest Smart, Live Smart
Wealth Edge:
- Flexible Premium Options
- Multiple Fund Allocations
- Systematic Withdrawals
- Premium Waiver Benefit
Popular Search
- What is ULIP?
- ULIP Tax Benefit
- ULIP Full Form
- ULIP Vs Term Insurance
- Best ULIP Plans
- Best ULIP Plan For Child
- Allocation Charges In ULIP
- ULIP Returns In 15 Years
- Difference Between ULIP and Mutual Fund
- ULIP Vs SIP
- Mortality Charges In ULIP
- What is NAV?
- How ULIP Works?
- Tips to Buy ULIPs
- ULIP Calculator
- Power of Compounding Calculator
- ULIP Tax Benefits in India