Introduction: Are you comparing different plans of Online life insurance and hoping you could possibly get more returns from a plan? Are you looking to invest in a plan that can benefit from market movements and offer healthy returns? Are you seeking flexibility to manage your funds? If the answer to all these questions is a yes, read on to understand the benefits of investing in a unit linked insurance plan (ULIP).
ULIP is an integrated plan that provides dual benefits of insurance cover and investment. Unlike a pure life insurance policy that merely provides an insurance cover, a ULIP plan provides an opportunity to earn market-linked returns. A portion of the premium in such a plan is invested in market-linked funds.
The best ULIP plans aim at creating wealth in the long term by maximizing the returns on investment. When you make an investment in a ULIP plan, the insurance company invests a portion of the premium in shares and bonds while the balance amount is utilized to provide an insurance cover. As fund managers in the insurance company use their understanding of the market to maximize returns on investment, the investor does not have to worry about tracking the investments. These fund managers may invest in different market instruments including debt and equity in varying proportions.
As insurance companies offer different types of insurance plans, choosing the best ULIP plan to meet your specific investment needs and long term goals can be a challenging task. You must assess factors such as risk appetite, long term goals and your own understanding of the market. Once you have assessed your specific requirements and financial goals, you must compare different types of ULIP plans in the market. It may be a good idea at this stage to investigate the nature and performance of funds that a ULIP invests in to estimate the returns on investment. Canara HSBC Life Insurance offers some of the best ULIP plans that can help achieve long term goals of your family.
Before you decide to buy life insurance online, consider the several advantages of investing in a ULIP plan. ULIP is an ideal plan for long term investment. Investing in a ULIP can be a smart decision for an investor looking to capitalize on healthy market returns. Despite the market risk involved, investing in a ULIP is considered a safe and secure investment. These plans can help fulfill personal goals such as funding your child’s higher education, buying a house, and retirement planning. With the insurance cover, these plans offer security in case of the untimely death of the policyholder.
Flexibility is a key advantage of a ULIP plan. Based on their risk appetite and understanding of the market, investors have the option to switch between debt and equity funds to match their changing requirements. Another benefit of ULIP plans is that the various charges associated with the plan are disclosed upfront. For example, premium allocation is charged on the premium paid in the initial years of the policy. Fund management charges are applicable for the management of various funds. Mortality charges are applied for the insurance coverage and depend on factors such as the age and the amount of cover. In addition, there are policy administration charges that can be levied at a fixed rate. Thus, there is complete transparency with no hidden charges.
The performance of ULIP plans is impacted by the changing dynamics of the capital market. As market dynamics can change over a period, the performance of investor funds can also change. Thus, as returns may not be guaranteed, investment in a ULIP plan is not free from risks. The investment risk in the investment portfolio is borne by the policyholder.
Conclusion: ULIP plans are ideal for long term investment. Along with a life insurance cover, these plans invest the policyholder’s money in different market linked funds to maximize the returns on investment. Thus, the investor has a good chance of benefiting from market movements and earning healthy returns to meet financial goals. The flexibility to switch between debt and equity funds has made ULIP plans popular with investors who can use their understanding of the market to switch their investment portfolio.
Invest 4G is among the best ULIP plans from Canara HSBC Life Insurance that offers multiple options to invest your savings. This plan is best suited for wealth creation to meet your long term financial goals. Investors can choose between 7 different funds and 4 portfolio strategies to maximize their returns on investment.
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