Unit Linked Insurance Plan or ULIP has been often called the most comprehensive financial planning solution for individuals. It not only provides you with a combination of insurance and investments, but also helps you save on taxes, which not all financial instruments let you do. ULIPS can help you plan for your life goals and act as Child Plans, Retirement Plans and Investment Plans. Here we look at 5 Unique Benefits of investing in ULIPs:
- Investment + Insurance: ULIPs – ULIP plans provide the best of both worlds. They offer you, life insurance as well as provide you with a solid investment option.
- Choose as per your Risk Appetite: ULIPs give you the flexibility of investing in your preferred ratio in debt, equity or hybrid funds. You are also free to change the structure of your ULIP in the middle of your investment period, making it an extremely easy and flexible option for you to invest in. If you want to invest aggressively at first you can choose equity funds and at a later stage, when your risk appetite decreases, you can switch to debt ULIP funds.
- Tax Exemptions: ULIP Premiums are exempted under Section 80C of Income Tax Act, which means any amount up to Rs. 1,50,000 paid as ULIP premiums is exempted from any taxes. Similarly, all withdrawals of ULIP after maturity are tax-free, unlike many other financial instruments.
- Top Up Facility: Unit Linked Insurance Plan also gives you an option to top up your existing policy with additional premiums. This way, if your policy is performing well, you can allocate additional funds in your existing ULIP
- Single Premium: With ULIPs, you also have an option to choose a single premium policy, instead of choosing to pay over regular intervals of time. This way, whenever you have some extra money, you can easily invest in ULIP expect high returns in the long run.