Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term

Protect Your family’s financial future with Kotak e-Term. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more


Get a Call

Enter your contact details below and we will get in touch with you at the earliest.

  • Select your Query

Thank you

Our representative will get in touch with you at the earliest.

Know Why You Should Stay Invested in Your ULIP Plan

ULIP or Unit Linked Insurance Plan is an insurance plan that offers the dual benefits of investment as well as insurance. Read the article to know 4 reasons why you should remain invested.

  • Nov 30, 2021


Your ULIP plan could be your key to long-term financial growth if you play your cards right. Retain your trust in it to reap maximum benefits and to potentially grow your wealth by leaps and bounds. Keep reading to know why you should remain invested in ULIPs.


ULIP or Unit Linked Insurance Plan is an insurance plan that offers the dual benefits of investment as well as insurance.Known for offering tax benefits and high potential returns and insurance cover, a part of the premium paid is invested. The rest is used for providing insurance cover.

ULIPs are trusted by investors for many reasons, such as;

  • Tax benefits under sections 80C and 10 (10D) on investment, maturity, and withdrawals.
  • The dual benefit of life insurance cover and investment in equity or debt asset class.
  • Switch between equity and debt asset class, a certain number of times for free.

While ULIPs are surely a popular investment and insurance product and come with a lock-in period of 5 years, most experts recommend staying invested for longer to reap the maximum benefits.

Let’s look at some reasons why you should stay invested in your ULIPs even after your lock-in period is over.

Average Out your Costs Better

Most of the costs of a ULIP are paid upfront, also known as front-end charges. After the 5-year lock-in period, and once you stop investing further, the cost spread is averaged out over the years as you remain invested. The longer you are invested, the lower the cost per fund unit you hold. Thus, remain invested in your ULIPs to average out the costs better.

Tax Benefits on Partial Withdrawals

If you’re thinking about withdrawing your ULIP for answering an urgent financial need, you can consider making a partial withdrawal. If the partial withdrawal is not more than 20% of the fund value, you still get tax exemption on the same. ULIPs are one of the few investment and insurance products that come with a partial withdrawal facility and still allowing you to get tax benefits.

Readjust Your Portfolio For Free

Most ULIPs come with free switches up to a certain limit where you can switch between funds without incurring a cost. This allows you to readjust the asset allocation between equity and debt instruments based on your evolving financial objectives and risk appetite. Thus, ULIPs are easy to manage in the long term as your financial objectives or risk appetite may change. For instance, your risk appetite may be higher, and hence your asset allocation could be tilting more towards equity, but as you age, you may want more conservative investment options. You, therefore, may want to make your portfolio more debt-instruments heavy. A ULIP allows you to do that without incurring switching costs.

Equity Tends to Perform Better in the Long-term

While you can choose between equity and debt when investing in ULIPs, most investors opt for equity for the high return potential it brings to your portfolio. Equity as an asset class is known to perform better if you stay invested for the long term. This is because it’s better able to tide through the market volatilities and grow steadily.

You have aptly chosen the ULIP plan as an investment and insurance tool. Now, stay invested in it for a longer tenure to get the most of its benefits and achieve your financial goals.

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Kotak e-Invest

Download Brochure


  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521


- A Consumer Education Initiative series by Kotak Life

Similar Articles

What is Partial Withdrawal in ULIPs?

Types of Annuity Plan | Annuity Definition - Meaning & Key Benefits

How Has NPS Performed in Comparison with Other Instruments?

Does Having Both ULIP Plan and Other Health Insurance Plan Make Sense?

Why Should You start Retirement Planning as soon as you start a job?

Annuity Plan | How to Choose the Right Annuity Plan | Kotak Life

Which Is Better: ULIP or SIP?

5 Reasons Why ULIP Plans are One of The Best Retirement Planning Instruments

Give Your Retirement Savings A Booster-Shot with Annuities

Saving for approaching retirement with retirement insurance

What is a Retirement Plan - What are its Features?

How has ULIP Grown Over the Last 3 years?

Worried About Running Out of Money in Retirement? 4 Tips to Avoid This Crisis

How to Maximize Your Retirement Savings with a Pension Scheme in India

Retirement Planning Guide for Working Men and Women

Tips to invest your voluntary retirement scheme money

What is an Annuity Plan, and How Does Annuity Plan Work?

5 Retirement Planning Tips for a Financially Controlled Post-Employment Life

Meaning of Sum Assured in a ULIP

What are the Benefits of ULIP - Explained

How to Build a Tax-Free Pension Income for Retirement?

Benefits of Early Retirement Planning in India

Is it possible to live a financially independent life, even after you retire?

7 Secrets that can Make Your Post-Retirement Phase Prosperous

How Does Pension Plans in India Works?

Retirement Planning for Millennials

Is ULIP Better Than FD?

What are the Uses of ULIP?

Is It Worth Buying ULIP Plans For 10 Years?

What Are Superannuation Benefits?

6 Signs That You Are Not Financially Ready For An Early Retirement

Retirement and Pension Plans in India- What are Your Options?

Why You Should Invest In An Annuity Plan?

What is the Estimated Return Percentage on ULIP? Do Investors Get Compound Interest?

10 Steps to Figure Out How Much Money You Will Need For Your Post Retirement Plans

What is the Death Claim Payable in the Case of ULIP?

How Quickly is Fund Switch Effected in ULIPs? Is it Done the Same Day or After a Particular Number of Days?

5 Steps to Gift a Smart Retirement Plan to Your Parents

Top 4 Mistakes To Avoid While Planning For Your Retirement

How Do Annuity Options Work In NPS

How Does NPS Work?

Terminologies You Should Understand About Retirement Plans

A Beginner's Guide to Understanding 401k Retirement Plan

What Are Mortality Charges In ULIP?

Who Gets the Benefit After the Maturity of ULIP: The Proposer or The Life Insured?

Can I Surrender My ULIP Policy after 2 Years?

What is Premium Redirection in ULIPs Plans | ULIP Insurance Plans | Kotak Life Insurance

What is Lock-In Period in ULIPs?

What is the Difference Between EPF, VPF, and PPF? What are Their Tax Benefits?

How Does ULIP Work in India?

Are Annuities Great For Early Retirement?

ELSS vs ULIP: Which is a Better Investment?

What are the minimum and maximum investment in ULIP? Would the Whole Amount Insured in The ULIP Insurance be Invested in the Market?

Demystifying the Retirement Planning Process

Do Pension Plans Allow any Death Benefits?

Pros and Cons of Retirement Annuities

What are the Rules for Exit From NPS?

NPS for Housewife

5 Common ULIP Myths That You Should Stop Believing

What is a Defined Benefit Plan and How it Works?

Types of Retirement Plans

Can NRIs Invest in ULIP Plans Offered in India?

How to Win at Retirement Savings?

How Safe is it to Invest in ULIP plans?

यूलिप में 8 शुल्क जो आपको अवश्य जानना चाहिए

What Happens to ULIP Premiums Paid if the Market Crashes?

Why Should You Invest in NPS?

Top Investment Options for Retirement Planning

Best Insurance Plans for a Guaranteed Monthly Income After Retirement!

Save Early to Keep Living Your Dreams Post Retirement

Retirement Planning at 50? You Are Still Good to Go

Benefits Of Retirement & How Investments Can Help You Enjoy Them

Why Should Retirement Planning Be on Top of Your Priority List?

At What Age Should You Start Your Retirement Planning?

How Can ULIPs Help You Plan for Your Child's Future?

Benefits of Early Retirement Plans

Inflation: A Key Factor to Consider into Retirement Planning

Top 6 Reasons Why You Should Get A Pension Plan

Ten Signs That You're Ready to Retire

Is ULIP A Good Investment Option?

Which Pension Plan Suits You best?

Do ULIPs Give Good Returns On Investments?

What are the 4 Financial Phases of Retirement? How to Budget For Each One?

How should one decide on fund allocation within NPS?

How can NPS help you save tax?

Long Term Investment Guide for Your Retirement

Different Types of Retirement Schemes

Are You Planning an Early Retirement? Here's Why Buying Annuity Plan Will Make Sense

Retirement Planning: Use our Retirement Calculator to Plan Ahead

How To Make Most of Your Money After Retirement?

FAQs on Taxation of ULIPs

How To Choose The Right Pension Plan?

What are the Chances of Losing all my Money in ULIP and How Much Return Should I Expect?

Retirement Planning - How To Calculate Your Retirement Premium in India?

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

Is ULIP a Complex Financial Product?

What To Do With Your Retirement Accounts During An Employment Lapse?

What is the Minimum Lock-in Period for ULIP?

What is the difference between Life Insurance and ULIP?

What tax benefits are there on saving for retirement?

ULIP Tax Benefits: यहां निवेश करने पर मिलते हैं 5 बड़े फायदे

How To Keep Your Retirement Accounts from Being Hacked?

Looking for Ways to Earn Lifetime Income in Retirement? Here Are 6 of the Top Options

Why ULIP Should Be a Part of Your Investment Portfolio?

Different Types of ULIP Investments in India

Advantages of Pension Schemes and Retirement Plans

Importance of Retirement Planning

What are the things to consider before buying ULIPs?

EPF Grievance Management: All You Need to Know

ULIP Plan or Traditional Insurance Plans - Which is better?

What Are Retirement Pension Plans?

Getting Close to Retirement? Six Key Retirement Planning Tips That Can Help You Retire

Is ULIP a Good Option for People Above 60?

Understanding Annuity Plans

Is it Advisable to Withdraw the ULIP Insurance Policy After 5 Years?

5 Notable Investment Options for Retirees

How Much Corpus Does One Need for Retirement?

Difference Between Unit-Linked Insurance Plans and Non-Linked Plans

What are ULIPs and their Types?

The Significance of Number 8,000 in Retirement Planning

Types of Pension Plans for Your Retirement

5 Reasons to Buy ULIP for a Secured Financial Future

Top 4 Myths About ULIP Investments You Should Know

What are the Differences Between ELSS ULIP and Mutual Funds?

Is it Suggestible to Take a ULIP Plan Linked with a Term Plan?

Calculating a Retirement Corpus that can Support Your Lifestyle

A Quick Guide to Retirement Plans

Importance of financial Planning for Retirement

Here's What Retirement Would Look Like 30 Years From Now

What Happens If I Stop Paying My ULIP Policy Premium After Paying the First Premium? Will I Still Get The Return?

Retirement: A New Start to Life!

Single Premium ULIP or a PPF - Which One is Better?

What are Fixed Maturity Plans and Why Should I Invest in Them?

10 Steps to Figure Out How Much Money You Will Need After You Retire

Top 6 Flexible Benefits That ULIPs Offer

How To Calculate The Present Value And Future Value Of Annuities?

ULIP: Can You Surrender ULIPs or Withdraw Money from It?

What is Fund Value in ULIP?

What are the Instruments Available for Building a Retirement Corpus?

Invest for your second innings with a guaranteed savings plan

Retirement Planning Guide: These 5 Steps Will Help You Towards a Safe, Secure and Fun Retirement

Retirement planning with a systematic life insurance plan

ULIPs or Pension Plans – Which is a Better Retirement Plan?

Un-Retirement - Are You Ready For It?

What are the Charges Levied on ULIP?

यूलिप और उनके प्रकार क्या हैं?

How Can I Achieve My Wealth Goal with ULIP Investment?