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How & When to Switch Your ULIP Funds

By Finserv MARKETS - Mar 28,2019
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Unit Linked Insurance Plan is a type of life insurance that provides investment options coupled with life insurance cover. You have the freedom of investing in the fund of your choice, which are further invested by the insurance provider in a number of options like bonds, stocks or equity funds. Let’s take a look at some of the ULIP benefits:

  • ULIPs provide flexible investment options across different risk categories. You can choose any avenue according to your risk appetite.
  • These investment options are very transparent with clearly defined tenures and charge structures. This will help you get a proper understanding of the scheme before making any kinds of investments.
  • It’s an excellent option for people looking to develop a regular saving habit.
  • Tax benefits can be availed under Section 80C.

What Is a Switch in ULIP?

The fund switch is a beneficial option offered to the invester. If you’re not satisfied with your current ULIP returns, then you can shift from debt funds to equity funds by means of this facility. Conversely, if you seek a steady income, then move to debt funds. You can also split up your investments across both the funds.

How to Switch Funds in ULIP?

The policyholder can straight-up access the customer portal on our website and manage their ULIP funds. This means the funds using switching option can be diverted online.

Investors are often confused about the perfect time of switching funds. Consider the following tips for fund switching and profit maximization:

  • Start by investing in bond-based funds as they provide risk-free and steady returns.
  • After a sizeable period of time, switch from bond fund to growth fund. This must be done only when the stock market has moved down gradually for some time.
  • Don’t wait for the lowest market point for switching to growth fund.
  • Don’t worry about the downward movement of the market and wait for the trend to reverse.
  • Switch back to bond after the market have risen.
  • Again, don’t wait for the highest point to do the switching.
  • Don’t switch your funds too frequently.
  • Try keeping your money in safer funds for the most amount of time.

Make sure to research about the different ULIP plans before investing your money. Now that you’re aware of how to switch funds, use this facility to your maximum advantage and opt for a unit linked insurance plan with Finserv MARKETS.

To know more on ULIP investments in depth, you can check out these blogs:

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Bajaj Finserv Direct Limited ("BFDL") is primarily engaged in distribution of financial products and services through its digital platform (“Bajaj Finserv MARKETS”) and inter alia renders services of customer acquisition, providing preliminary credit support activities, fulfilment services and post-acquisition customer services to Banks, NBFCs, HFCs. BFDL is also a registered Corporate Agent (Composite) under valid IRDAI registration number: CA0551 valid till 10-Apr-2024 for solicitation and servicing of Insurance Products. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522