Tax savings, Investments and Insurance are some of the most critical aspects of financial planning. People tend to make investments to create wealth over time while the investment options also provide tax-savings benefits alongside. However, when it comes to insurance, they always look for sole insurance-related products to fulfil the said requirements.
What if we tell you that there is an insurance option available in the market that provides all the three aspects that will help you accomplish your financial goal.
Unit Linked Insurance Plans (ULIPs) is an insurance plan that offers double advantages. Here, along with a sound life insurance coverage, you also get to invest in funds of your choice. The funds that you choose to invest in can either be equity-oriented, debt funds, or a combination of the two.
You can read more about what is ULIP in our Insurance section to get a clearer picture.
Following are five lucrative ULIP benefits that will help you understand why ULIP is the right investment decision.
Along with investment growth and insurance coverage, you can enjoy ULIP tax benefits. You can claim deductions for the premiums paid towards ULIPs under Section 80C of the Income Tax Act, 1961.
The limit set to claim deductions is of up to INR 1.5 lakh on the annual premium amount. In fact, the top-up premiums paid on your ULIP investment can also be claimed as deductions. Moreover, the maturity benefits are tax-free under Section 10(10D) of the Income Tax Act, 1961.
Generally, ULIP plans have a lock-in period of 5 years. However, after the lock-in period is over, you can make partial withdrawals from your policy in case of a financial crisis. Partial withdrawals are free of cost. At Finserv MARKETS, with high returns on mortality charges, the policyholder can withdraw the full amount after the completion of the lock-in period.
Unit linked insurance plans are highly flexible, i.e. they allow you to switch funds according to your financial goals, needs and changing risk appetite. Additionally, ULIPs offer you the freedom to opt for additional protection through riders. Hence, you have the freedom to control and manage your investment as well as your life insurance risk cover based on your requirements.
Mitigation of Risk
Thanks to professional fund management and long term life goal-based investment, the money you invest in ULIP becomes relatively safer against various market-related risks. This indeed is a good option for investors who wish to expand their finances but want to avoid managing the associated risks. Although, in case any, the risk is borne by the policyholder.
Potentially Higher Returns
You get the opportunity to earn potentially higher returns over the long term at a relatively low-risk profile. Since a part of the premium amount is invested, you can decide (depending on your risk appetite) the fund options you want to invest in.
Further, depending on market performance, your funds will yield reasonable returns. If you are not satisfied with the fund performance, you can always make changes to your investment portfolio as per your needs.
Moreover, calculating returns at Finserv MARKETS is easy with the ULIP calculator online.
Still confused about ULIPs and how it is the most comprehensive investment and tax-saving tool? Maybe this infographic will help you understand the advantages better.
So, what will you get by investing in a ULIP plan?
By investing in a unit linked insurance plan, you can plan for your long-term goals and ensure that they are met, “with you or without you”. Moreover, with amazing ULIP tax benefits under Section 80C and Section 10(10D) of the Income Tax Act, 1961, they are one of the best tax-saving financial products available in the market today.
However, it is surprising that while planning their life-goals, people often miss out on such a lucrative investment tool. If you invest wisely, unit linked insurance plans can be the perfect solution for all your needs and help you protect your financial future.
The Bottom Line
Without a doubt, a unit linked insurance plan is an ideal investment instrument for someone who wants to avail tax benefits and at the same time, aims to secure the financial future of his/her family. And, all of the above-mentioned ULIP benefits and features have proved the just fulfilment of the same.
Invest in a unit linked insurance plan to build a financially secure future for yourself and your family.
By investing in Bajaj Allianz ULIP available on Finserv MARKETS, you can enjoy many other lucrative features as compared to regular plans. Some of the key benefits and features include – security, convenience, zero fund switching charges, option to alter premium payment frequency, enhanced maturity benefit, simple claim process and much more!
To know more on ULIP investments in depth, you can check out these blogs:
Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition – Offers You Value. A value proposition that ensures you get offers which are tailor-made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we works towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App.