5 Amazing Tips - Achieve Fund Growth through ULIPs
Any unit-linked plan offers market-related benefits for the ultimate garnering of the returns on investment. This means that the benefits that you can garner are dependent on the market-performance of a particular fund-option. In simple terms, ULIPs are Unit Linked Insurance Plans that serve as joint instruments for insurance coverage and investment through a variety of fund options. ULIPs come with a lock-in period of 5 years and therefore, enable financial discipline through regular investments which makes them ideal for long term financial goals. ULIPs also have the feature of permissible switches between various fund options that makes them very flexible and the subscriber gets to choose the fun option as per her/his risk appetite. Besides, investments in a ULIP come with tax benefits under Sections 80C and 10D of the Income Tax Act, 1961 and are also exempt from LTCG taxation.
Unit Linked Insurance Plan offer the feature of fund switches between multiple fund options. This means that the policy holder can switch between fund options depending on how a particular fund is performing at the market. The insurers provide this switch option free of any cost up to a maximum of 10 or even 12 switches. After this, a nominal fee for switching between funds is charged. Therefore, ULIPs are very flexible in terms of the customer's preferences and offer a credible flexibility that allows the policy holder to make informed decisions. These days, owing to the increased customer-focus and the innovative market-practices, various insurers are offering various features that are suited to various customer requirements and needs. Therefore, it is very important to check and make an online comparison of the various plans on offer. This can be easily done by logging on to the official portals of the various insurers and comparing the various plan-features. This will give you a clear idea about the specific advantages and will help you in taking an informed decision.
The premium paid by the customer is diverted into two channels- one part goes for the insurance cover while the other is added to the investment corpus, from a host of options. Besides being flexible in terms of fund options that you get to choose from, ULIPs also provide tax benefits under Section 80Cof the Income Tax Act, 1961.. ULIPs have a lock in period of five years (earlier it was three years) and is suitable for specific financial goals over a period of time. There are tax benefits Tax saving is a very crucial factor for deciding the overall returns from an investment and this is where ULIPs score over various other investment options like Mutual Funds. As mentioned, under Sections 80C and 10D of the Income Tax Act, 1961, the payable premiums and the incurred benefits from investing in ULIPs are eligible for tax-exemption. Furthermore, under Section 80C of the Act, there is a tax deduction of up to an upper capping of Rs. 1.5 Lac on the payable premiums towards a ULIP.
HDFC Life offers HDFC Life Click 2 Wealth a unit linked plan that offers market-linked returns with minimal charges.
Related Articles
- What is ULIP (Unit Linked Insurance Plan)?
- All You Need to Know about ULIP Charges
- Is a ULIP plan a good investment during COVID-19?
- Top ULIP Myths That You Must Stop Believing In
Term Plan Articles
Investment Articles
Savings Articles
Life Insurance Articles
Tax Articles
Retirement Articles
ULIP Articles
Subscribe to get the latest articles directly in your inbox
Health Plans Articles
Child Plans Articles
Popular Calculators
Here's all you should know about life insurance.
We help you to make informed insurance decisions for a lifetime.
HDFC Life
Reviewed by Life Insurance Experts
HDFC LIFE IS A TRUSTED LIFE INSURANCE PARTNER
We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.
Popular Searches
- Term Insurance Calculator
- Investment Plans
- Investment Calculator
- Investment for Beginners
- Best Short Term Investments
- Best Long Term Investments
- 5 year Investment Plan
- savings plan
- ulip plan
- retirement plans
- health plans
- child insurance plans
- group insurance plans
- income tax calculator
- bmi calculator
- compound interest calculator
- income tax slab
- Income Tax Return
- what is term insurance
- Ulip vs SIP
- tax planning for salaried employees
- HRA Calculator
- Annuity From NPS
- Retirement Calculator
- Pension Calculator
- nps vs ppf
- short term investment plans
- safest investment options
- one time investment plans
- types of investments
- best investment options
- best investment options in India
- Term Insurance for Housewife
- Money Back Policy
- 1 Crore Term Insurance
- life Insurance policy
- NPS Calculator
- Savings Calculator
- life Insurance
- Gratuity Calculator
- Zero Cost Term Insurance
- critical illness insurance
- itc claim
- deductions under 80C
- section 80d
- Whole Life Insurance
- benefits of term insurance
- types of life insurance
- types of term insurance
- Benefits of Life Insurance
- Endowment Policy
- Term Insurance for NRI
- Term Insurance for Women
- Term Insurance for Self Employed
- Benefits of Health Insurance
- Health Insurance for Senior Citizens
- Health Insurance for NRI
- Best Term Insurance Plan for 1 Crore
- personal accident insurance
- Annuity Calculator