In recent times, there has been an increased preference of mutual fund companies as well as insurance companies to combine the investments in stock markets with life insurance plans, known as ULIPs. This need has arisen as there is very low penetration of life insurance in India or lack of awareness of the need for such policies, compared to other countries.
A ULIP is both an insurance policy and an investment. The policy specifies a death benefit – the amount the nominee will be paid if the policyholder passes away during the term of the ULIP. In addition, if the policy holder survives the term of the ULIP, he/she can also get the maturity value of the ULIP. This will be the amount generated by the ULIP investments in equity and/or debt. The policyholder is typically allowed to choose ULIP funds and asset classes to generate these returns. This is the investment component of a ULIP.
Benefits of ULIPs
Regular Savings
ULIPs inculcate the habit of regular and disciplined savings, which is the key to successful long-term financial planning. With regular premium payments, you can enjoy the benefits of wealth creation for your loved ones.
Protection
ULIPs provide the protective benefit of a Life Cover, which keeps your family secure in your absence.ULIPs provide the protective benefit of a Life Cover, which keeps your family secure in your absence.
Potential for Growth
There is a potential of earning higher returns from the power of equity and debt funds. This will help you achieve your life-goals such as buying a new home, your dream car, funding your child’s higher education and much more.
KPSC Notes brings Prelims and Mains programs for KPSC Prelims and KPSC Mains Exam preparation. Various Programs initiated by KPSC Notes are as follows:-- KPSC Mains Tests and Notes Program
- KPSC Prelims Exam 2024- Test Series and Notes Program
- KPSC Prelims and Mains Tests Series and Notes Program
- KPSC Detailed Complete Prelims Notes