Kotak e-Term Plan
Kotak e-Term Plan provides a high level of protection to your loved ones in your absence.
Kotak Guaranteed Savings Plan
Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality.
Kotak E-Invest
Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs.
Kotak Health Shield
Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability.
Kotak Lifetime Income Plan
Kotak Lifetime Income Plan gives you the security of your income continuing throughout your life and in your absence throughout your spouse's lifetime!
An ongoing debate over investing instruments constantly raises the question of what is better between ULIP and FD in terms of potential investment returns.
While this is a very subjective topic due to a variety of aspects such as financial goals, budgets, and much more, many people think that when you compare ULIP plans to FD plans, the former appears to provide greater returns.
In this article, we will compare ULIP investments and FDs in-depth to help you decide which is the better option for you according to your requirements.
A fixed deposit is a financial product offered by banks or non-bank financial companies (NBFCs) that pays a greater interest rate to clients than a conventional savings account till the maturity period.
There is no lock-in period, but the bank may levy a fee if the money is taken well before the deadline, resulting in a loss of interest.
Fixed deposits do not provide you with the freedom to allocate your earnings as you see fit.
The majority of FDs do not include life insurance coverage, hence there are no death benefits offered.
Only the amount invested is free from taxes. The income returns from an FD is entirely liable for tax deductions provided it crosses the set slab.
ULIP investment provides both insurance and investing advantages. Thus, people are always on the hunt for the best ULIP plan. In this situation, the payment is split into two parts: one is used to provide life insurance premiums, and the other is used to invest in money market products. The earnings from even a debt fund in a unit-linked insurance policy are tax-free in the hands of the investor, setting it apart from all other market-related investments.
ULIP comes with a five-year lock-in period. The upside to this is that it helps in building investment and savings habits. Plus, the returns you get after 5 years are worth the wait, which makes you believe that money takes time to grow. The lock-in period is usually specified by the policy’s grant date, and the premium must be paid monthly or yearly.
One of the ULIP benefits is that it provides you with the freedom to adjust the fund’s distribution as per the current market conditions. So, let’s say you are a risk-taker, you can invest in equity funds. At the same time, if you realize that you need an emergency fund, you can switch to a debt fund.
ULIPs provide both life insurance and investing rewards as one of its defining features. This characteristic is not seen in any other investment tool. According to IRDAI requirements, ULIPs must include life insurance worth at least three times the yearly cost.
ULIP investment is subject to tax deductions under Section 80C of the Income Tax Act. Annually, an investor can receive benefits up to ₹1,50,000 under 80C investments. Likewise, under Section 10D of the Income Tax Act, the profits you get at the maturity of your ULIP insurance are tax-free. Furthermore, under Section 10 (10D) of the act, the death benefit received by the beneficiary in case of the policyholder’s death is also tax-free.
To sum up, we may infer from this article that ULIPs are a preferable investment alternative to FDs. Thus, if you are looking for the best ULIP plan, it is recommended that you undertake the necessary research to compare ULIP plans and opt for the one that best meets your needs.
Ref. No. KLI/22-23/E-BB/492
