A unit-linked insurance plan (ULIP) is a plan that provides the benefits of life cover as well as investment. Therefore, by purchasing this policy, a person can secure his/her family and earn good returns.
If you want to know more about the benefits of a ULIP, then read this article.
Many people look for plans that can financially secure their family. One of the best policies that can help them achieve this goal is a ULIP.
A ULIP is a unique product that offers dual benefits. It provides the benefits of insurance and investment. When a person invests in a ULIP, a part of the premium is invested in life cover, and the remaining amount is invested in various investment instruments, like debt funds, equity funds, etc.
Thus, ULIPs are a great option for building wealth and ensuring financial protection. The insurer can provide a sum assured to the policyholder’s family in case of an unfortunate event. Furthermore, the investment allows the insured person to earn good returns. Hence, helping the policyholder build a significant financial corpus. Also, purchasing this plan has become very easy. A person can easily buy a ULIP plan online effortlessly.
Here are some of the benefits of a ULIP-
It Can Provide Investment Returns
There are various equity and debt fund options in ULIPs. Thus, a person can choose the funds based on his/her financial requirements and risk appetite. For instance, if an individual has a high-risk appetite, then he/she should consider investing in equity funds.
It Can Provide Life Cover
While accumulating funds for achieving life goals is important, every person should also look for options that can ensure the financial security of their family. A ULIP can help a person earn returns and provide life cover.
Thus, if the policyholder passes away during the tenure of the policy, then the insurer can provide a sum assured to his/her beneficiaries. Therefore, the sum assured can help them meet their life goals.
It Offers Flexibility
As ULIPs allow individuals to invest in market-linked options, they can earn higher returns. A person can choose between high, medium, and low-risk investment options in the same ULIP. Furthermore, there are ULIPs that allow people to switch between assets based on their risk appetite. This can help people maximise their returns.
It Offers Tax Benefits
The premium paid to purchase a ULIP can be claimed as a tax deduction under Section 80C up to Rs. 1.5 Lakh. Hence, with the help of such a plan, the policyholder can also save on taxes.
It Offers Add-Ons
Add-ons are additional benefits that a person can purchase by paying additional premiums. They can enhance security. For example, an accidental add-on can provide financial protection in case the policyholder meets with an accident.
A unit-linked insurance plan is a great option for people who want to provide their family with financial protection. Furthermore, by investing in a ULIP, a person can earn good returns. Thus, with the help of a ULIP, an individual can financially secure his/her family and build a corpus.