Individuals looking to build their wealth from a young age can do so through investments. However, it can often get confusing for many due to several options available to choose from. Among them, Unit-linked Insurance Plans (ULIPs) have emerged as one of the popular avenues. This is due to its dual benefit of providing life coverage and market-linked returns.


After opting for a ULIP, it is equally important to check your funds’ performance. This can help determine if you are on track with achieving your financial goals. Find out more about evaluating ULIP fund performance in the following sections.

Ways to Evaluate ULIP Fund Performance

To assess the fund's performance effectively, you can make use of some key parameters. These are: 

  • Volatility Analysis

Volatility refers to the level of fluctuation in your fund’s overall returns. A high degree could mean more associated risks with the fund. You can check your ULIP fund portfolio’s volatility by assessing its standard deviation. This can help show how much your fund’s returns may deviate from the average annual returns. Here, a lower standard deviation means lower volatility.

  • ULIP Calculator

You can also make use of a ULIP calculator to track your fund’s performance. All you need to do is input the premium amount, payment frequency, policy term, and details of your fund allocation. With this, you will be able to compare your ULIP’s performance with the estimate. Moreover, you can compare different ULIP plan’s performance. This can help you select the one that offers the best returns.

  • Fund Management Charges

Fund management charges are typically deducted from your fund portfolio. This is done in order to manage the fund. These can have a notable impact on your returns. It is important to check your insurance company’s fund management charges. Comparing them against other funds helps ensure that you are not paying higher fees.

  • Sharpe Ratio

The Sharpe ratio is known to calculate the risk-adjusted returns of a fund. It takes into account the returns obtained by the fund along with the associated risk. A higher ratio highlights good risk-adjusted returns. You can make use of the ULIP calculator to determine the Sharpe ratio of your investment.

  • Annualised Returns

Annualised returns are a crucial parameter to assess your ULIP’s performance. It is determined as a percentage and shows the rate of return on your investment for a year. You will be able to calculate the annualised returns of your fund on the insurer’s website. Alternatively, you can make use of a ULIP calculator.


Evaluating the performance of your ULIP fund is essential. It ensures that your investment aligns with your financial goals. This could also help you maximise returns while managing associated risks. By doing so, you could build substantial wealth over time. Moreover, you can ensure that your ULIP continues to contribute to your portfolio.

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