Kotak Life
Close

Buy a Life Insurance Plan in a few clicks

Close

Now you can buy life insurance plan online.

Kotak e-Term Plan

Kotak e-Term Plan provides a high level of protection to your loved ones in your absence. Know more

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. Know more

Kotak E-Invest

Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs. Know more

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. Know more

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! Know more

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains
  • 7th Jul 2022 |
  • 2,729

With the rising inflation, adopting a modern investment strategy is essential. This helps you keep up with the market and ensures that your financial future is stable and secure. Unit Linked Insurance Plans, popularly known as ULIPs, are among today’s most purchased modern insurance plans. The reason behind this popularity is the dual benefit of insurance and investment that ULIPs offers to the policyholder in a single policy. This unique combination helps the policyholder enjoy the safety of life insurance while gaining profit on investment in different ULIP funds. However, since the investment part of the ULIP policies is market-linked, it is crucial to follow an investment strategy to avoid making minimal gains or incurring losses.

ULIP Investment Strategy

The ULIP policies have two components embedded together in one policy. On the one hand, the life insurance components offer protection from any uncertain incident. In contrast, the investment component helps you make money to tackle the inflation in the longer term allowing you to fulfill your financial goals. But to maximize your returns on the investment in ULIP funds, you must follow specific tips. Therefore, as part of a ULIP investment strategy, here is some information related to different aspects of the ULIP investment that will help you get financially stronger over time.

Top Tips to Improve Your ULIP Gains

Fund Switching

As we all know, market performance changes over time; thus, as an investor, you must be well aware of the market trends. ULIPs offer a unique feature that allows you to choose and switch between funds as required. Generally, the ULIP policies allow some accessible fund switches allocated to the policyholder at the time of policy induction. However, once you have exhausted your free limits, you must pay a nominal charge to switch between funds. Therefore, switching between the ULIP funds based on market trends ensures that your return on ULIP investment is multiplied. Consequently, you https://www.kotaklife.com/admin.php?/cp/publish/edit/entry/260386should talk to your insurance agent or read more about fund switching before opting for a ULIP policy.

Economic Scenario Analysis

It is essential to evaluate the current economic scenario that involves both the market and your financial situation. This step works in sync with the fund switching. As an investor, you must be aware of the current economic environment, the forecast, and expert recommendations of both global and national markets.

Key market indicators like crude oil prices, international relations, socio-economic scenarios, national schemes, national politics, national economic performance, etc., must be closely watched, as they play a vital role in the performance of markets. This may directly impact your ULIP investment.

In addition, an analysis of your present financial situation will also help you decide your risk-taking capabilities and which funds to choose. So, ensuring that you are well aware of the current market-related economic news and trends along with proper evaluation of your current financial status can help you in a wise investment of your ULIP funds in suitable market-linked securities.

Ensure Timely and Regular Payment of Premiums

Timely payment of premiums not only helps you in maintaining a good habit but also you in other ways. So, when you opt for a ULIP policy, certain charges are involved at policy induction, like administration charges, management charges, mortality charges, etc. However, when a policyholder pays the premium timely and regularly, some of these charges are paid back as a loyalty bonus. Additionally, by ensuring a timely payment of premium, you will generate compounding interest on your investment in the long run.

For example, if you pay the sum of the whole premium(s) at the beginning of the new policy year, say ₹50,000 Per Annum, then you will earn more interest on the total sum which is now your whole corpus + ₹50,000 compared to paying it later in the year.

Understand the Importance of Insurance

Generally, when people talk about the management and optimization of ULIPs, they mainly focus on the investment component of the plan. However, giving equal attention and priority to the other component, life insurance, is essential. You must also have a decent sum assured in the insurance part of ULIP plans. This will ensure that you are prepared for any uncertainties and that your loved ones are financially stable in case of your absence.

Conclusion

If you keep the ULIP investment strategy in mind and optimize your ULIP policy promptly, surely the return will multiply. First, however, you must ensure that your funds are not invested just in market-linked securities and are proportionally distributed among all the high, medium, and low-risk ULIP funds to balance each other out.

Kotak e-Term Plan

Features

  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

6 Reasons That Make Term Insurance a Must Buy

Should You Have Multiple Term Life Insurance Policies?

Insuring Against Accidents with an Accidental Death Insurance Rider

Comparing Term Plans – What Should You Look Out For

Term Insurance Basics You Should Know

How To Calculate The Amount Of Term Life Insurance You Need?

How Much Cover Should I Take In A Term Plan?

Should Youngsters, Working Couples Buy Term Insurance Plans?

Is term Insurance Needed for People With No Dependents?

What Should Be The Duration Of Your Term Plan in India?

Different Types of Premium in Term Insurance

Is It Good To Buy A Term Insurance Plan In 2022?

Is There Any Tax Benefit on Term Insurance?

What Is the Correct Age to Buy Term Insurance?

Why Should You Add a Rider to a Term Insurance Plan?

Term Insurance – Why You Must Include In Your Financial Planning?

Buying A Term Insurance? Don't Ignore the Claims Settlement Ratio

Key IRDAI Regulations That Changed Face Of Term Insurance Industry In 2020

How Not To Get Your Term Insurance Claim Rejected

How To Change The Nominee in Term Insurance?

Why Term Insurance Is Better Than ULIP?

How Much Term Life Insurance Cover Do I Need in India?

Do I Need to Give a Medical Test for Term Insurance in India?

Term Insurance With Riders In India

Is a Term Insurance Policy Portable?

Steps on How to Buy Term Insurance Online

Why Term Plan Should Be The First Step To Securing Your Future?

Eligibility Criteria for Buying Term Insurance in India

5 Term Insurance Benefits for Single Women

Why is it important to buy term insurance plan?

Best Investment Plans for Children - Secure Your Child's Future

6 Types of Death not covered in Term Insurance Plan

What Are the Best Term Insurance Plans for Planning Retirement?

5 Things To Consider While Buying Term Insurance Plan

Are The Add-ons and Optional Features of Term Insurance Plans Actually Beneficial?

5 Benefits of Early Retirement Planning

Should You Buy a Term Plan After 40?

Gift Your Father A Term Insurance Plan This Father's Day

Which Term Insurance to Choose: Lump Sum or Staggered Pay-out Plan?

8 Benefits of Term Insurance You Should Know

Can Non-Resident Indians (NRIs) Buy Term Insurance In India?

Insurance Policy for Housewife In India

Is Group Term Life Insurance Provided By Employer Sufficient?

Is Life Insurance Investment Worthy Enough

What is a short term insurance policy?

Why Buying a Term Plan Is Smarter Than Traditional Life Insurance Products

Protection for your family

Term Insurance: Most Common Term Insurance Myths Explained | Kotak Life

9 Ways to Help Family Members in Financial Trouble

What is the Right Term Period For Term Insurance Policy? Here's How You Should Choose!

Term Insurance Calculator - Everythng You Need To Know

Online vs Offline Term Insurance: Which Is The Better Option To Buy

Key Differences Between Term Insurance, ULIPs, And Health Insurance

Tips to Choose the Right Term Period for Term Insurance Plan

All you need to Know about Term Insurance Plans for Housewives

Can I Buy Term Insurance for a COVID-19 Patient?

Can I Extend the Tenure of My Term Insurance Plan?

Know How to Invest at Every Age for Larger Returns

4 Methods to Calculate How Much Term Insurance You Need

Planning For Son or Daughter's Wedding

Ensure Protection Against Death, Disease & Disability With Life Insurance

How to Buy 1 Crore Life Insurance Policy Without Medical Test

Why does every working woman need life insurance?

Term Plans are Definitely Cheaper than You Think!

Why should single women purchase term life insurance?

4 Things To Expect From Your Term Insurance Plan in India

Buying A Term Insurance Plan? Take These Factors into Account

Everything About Claim Settlement Ratio for Term Insurance

Ideal Features of a Suitable Term Plan - Act Now for a Stress-free Future

How to Compare Term Insurance Online

Term Life Insurance Plan for Smokers vs Non-Smokers

Term Insurance: What Happens When You Don’t Pay Your Premiums?

4 Reasons Why You Need Critical Illness Cover

Make Your Online Term Plan Your Familys Monthly Payout

Why Should You Not Take A Term Plan Without Medical Test in India?

Why 1 Cr Term Plan Is Necessary For Family?

How to Ensure That Your Term Insurance Claims Are Never Rejected?

Insuring Against Disability With Disability Insurance Rider

Can I Get Term Insurance on Behalf of My Spouse?

Choosing Riders for Insurance Plans

Why Premium Amount for Term Insurance is So Low?

Term Insurance Plans and Policies for Smokers

Why Buy Term Insurance Plan With a High Cover?

Why Surrendering Your Term Plan Policy In The Final Phase Maybe A Bad Idea?

What are the Documents Required for Term Insurance Plan?

What is Insurance Premium - A Detailed Guide

Why Should You Buy Term Insurance in 2022?

Why Married People Should Buy Term Insurance Under MWP Act?

Is it a Good Time to Buy Term Insurance During the COVID-19 Pandemic?

Can I Make Changes to My Term Insurance Policy Post Purchase?

What Is a Renewable Term Insurance Policy?

All About Term Insurance Inbuilt Coverage

Top 3 Reasons Why You Should Buy A Term Plan Now

Can Senior Citizens Avail Term Insurance?

Difference between Term Insurance and Life Insurance

Advantages of Buying Term Insurance in Your 50s

Cost of Term Insurance Likely to Increase Soon

What is a Joint Term Insurance Plan? Key Benefits of Joint Term Plan

Importance of Term Insurance at Every Stage of Your Life

Busting Myths and Facts About Term Insurance Policies

Can You Increase Your Term Insurance Cover?

Insuring Protection Against Death With Death Insurance Rider

What is Critical Illness Policy

Can A Housewife Buy a Term Insurance Plan - All You Need to Know

Why Term Insurance Is Important in times of COVID-19?

How Does A Term Life Insurance Work in India?

Make Your Online Term Plan Your Family's Monthly Pay Cheque

How To Choose the Right Term Insurance Plan?

टर्म इंश्योरेंस क्या है? टर्म इंश्योरेंस का मतलब

Does Term Insurance Cover Accidental Death?

Can Term Insurance Plans Be Purchased As A Gift?

What Happens to Term Insurance Plan With No Beneficiary - Kotak Life

Is ₹1 Crore Term Insurance Good Enough Cover?

Term Insurance: Smokers vs Non-Smokers

Individual Life Insurance vs. Group Term Life Insurance

While Buying Term Insurance Compare Features, Not Just Premiums

Term Insurance with Critical Illness

Does Your Term Insurance Plan Cover Death Due to COVID-19?

How Much Term Insurance Do I Need

What Types of Deaths Are Covered in a Term Insurance Plan?

Planning For Children's Future

What All Documents Required For Term Insurance In India?

How to Identify Term Insurance According to Your Needs?

Is Term Life Insurance Plan an Investment or Expense?

Do Beneficiaries Pay Taxes on Term Insurance?

Term Plan with Spouse Cover

How Does Term Life Insurance Work? Learn the Benefits

8 Factors to consider before choosing a Critical Illness Insurance

Increasing Term Insurance and Riders

5 Reasons to Buy Term Insurance When You are in Your 30s

Endowment Plans vs Term Plans: Understanding the difference

10-Year Term Life Insurance Policy - Explained in Detail

Tax Benefits of Term Insurance in India

Why Buy Term Insurance Even at Rising Rates?

Advantages & Disadvantages of Term Insurance in India

Why Should New Parents Buy Term Life Insurance?

What Is a Passive Income? Why Should You Use It to Buy a Term Plan?

What is Term Insurance - A Complete Guide

What Happens if you Hide Facts in your Term Insurance?

Reasons You Need Term Insurance Plan as a Self-Employed Person

Insuring yourself against Ill Health with a Critical Illness Rider

What is Form 16, Form 16 part A, Form 16 part B, Information Required and FAQs

What are incremental term insurance plans?

When is the Right Time to Buy Term Life Insurance Policy for Yourself?

How to Surrender Term Life Insurance When you have No Liabilities

9 Most Frequently Asked Questions on Term Insurance

Different Types of Protection Plans

8 Things To Do After Buying Term Insurance

Calculating Term Insurance Premium

Term Vs. Whole Life Insurance: Which One You Should Buy in India?

Understanding Term Insurance Riders

Term Insurance Age Limit – Term Plan for All Age Groups

Do You Need Term Insurance Cover After Retirement?

What Are Insurance Riders and How to Choose Them in a Term Plan?

What Should You opt for - Limited or Premium Pay?

Which Death Type Does Your Term Plan Not Cover?

How To Choose the Right Sum Assured Under a Term Plan?