What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. 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 Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?
  • 28th Mar 2022 |
  • 2,421

We all know that getting life insurance is the best and most reliable way to secure and provide protection for our loved ones’ after you. In case you survive the policy’s term, you are eligible for a maturity benefit equal to all premiums paid with most of the policies. But what if we told you there was a way to invest that included the benefits of both life insurance and market-based investing strategies all in one? Isn’t this too good to be true? Such policies are called ULIP.

What is a ULIP policy?

A Unit Linked Insurance Plan (ULIP) is a type of insurance with a 5-year lock-in period that integrates insurance and investment into one convenient bundle. The goal of ULIP is to provide both insurance coverage and wealth accumulation, with the insurance company investing a chunk of money in the insurance policy and the rest in a fund that is based on stocks, debt, or both and matches your long-term goals. Retirement planning, children’s education, or any other big event for which you may save are examples of these aspirations.

Since ULIPs are hybrid plans, they provide both sum assured and fund value benefits. Assuming you survive the ULIP’s final term, you can wonder what you’d receive between the two? Let’s take a closer look at the difference between the amount assured and fund value to have a better understanding of this.

Sum Assured vs. Fund Value

Sum Assured

In a Unit Linked Insurance Plan, the sum assured refers to the amount that the insurer pays to the policyholder’s loved ones if the policyholder dies during the policy’s term. In case of the insured event, it is the sum promised by the insurer to the policyholder’s beneficiaries. This amount practically promises the policyholder and their family that, in the case of a catastrophic catastrophe, the surviving relatives will receive a sum equivalent to the total guaranteed.

Fund Value

When you buy ULIP, you get a certain number of units in the fund. The ULIP fund performance or fund value is equivalent to the combined total value of the funds in your holdings. As a result, the returns you receive from your ULIP — that is, the fund value at maturity – are referred to as the fund value. A ULIP’s fund value is simple to determine. It’s calculated by multiplying the NAV of each unit in the fund on every given day by the number of units you own.

Moving on to the maturity benefits of ULIPs - they differ from traditional insurance policies in a few ways. The policy is deemed to have matured if you, the policyholder, live to see the end of the ULIP’s term, and the fund value is paid out to the policyholder upon maturity.

ULIP Tax Benefits

Until Budget 2021, the advantages on ULIP maturity were completely tax-free if certain requirements were met, as outlined in Section 10 (10D) of the Income Tax Act of 1961. As a result, now that we’re on the other side of the FY22 budget, the taxability of ULIP benefits based on maturity can be separated into two groups.

  • Returns on maturity are called ULIP tax benefits for those purchased before February 1, 2021.
  • In the budget for FY 2021-22, it was declared that for ULIPs authorized on or after February 1, 2021, the profits from the plan will now be taxed as capital gain if the accumulated premium exceeds ₹2.50 lakhs in any financial year during the policy’s term.

It is vital that you compare all of the plans and select the one that best meets your needs!

Kotak e-Invest

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


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

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


Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Retirement Planning at 50? You Are Still Good to Go

Understanding Annuity Plans

What are the Differences Between ELSS ULIP and Mutual Funds?

Retirement: A New Start to Life!

Top 4 Mistakes To Avoid While Planning For Your Retirement

Long Term Investment Guide for Your Retirement

Why You Should Invest In An Annuity Plan?

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

How to Choose the Best ULIP Plans to Invest in 2022?

Why Are ULIPs Called Flexible Investments?

Why ULIP Should Be a Part of Your Investment Portfolio?

Inflation: A Key Factor to Consider into Retirement Planning

Calculating a Retirement Corpus that can Support Your Lifestyle

What is Partial Withdrawal in ULIPs?

Is ULIP Better Than FD?

यूलिप के 8 शुल्क

A Quick Guide to Retirement Plans

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

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

Types of Retirement Plans

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

Saving for approaching retirement with retirement insurance

What are ULIPs and their Types?

Why Should You Invest in NPS?

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

What is NAV in ULIP, and How is it calculated?

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

5 Notable Investment Options for Retirees

NPS for Housewife

ELSS vs ULIP: Which is a Better Investment?

Invest for your second innings with a guaranteed savings plan

How Does ULIP Work in India?

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

What is Lock-In Period in ULIPs?

How is ULIP NAV calculated? How is the return calculated in ULIP?

Ten Signs That You're Ready to Retire

Terminologies You Should Understand About Retirement Plans

Know Why You Should Stay Invested in Your ULIP Plan

What Are Superannuation Benefits?

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

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

Top 4 Myths About ULIP Investments You Should Know

How should one decide on fund allocation within NPS?

What Are Retirement Pension Plans?

How To Choose The Right Pension Plan?

Is It Worth Buying ULIP Plans For 10 Years?

यूलिप के फायदे (Benefits of ULIP in Hindi)

How To Make Most of Your Money After Retirement?

Which Pension Plan Suits You best?

Is the ULIP Policy Surrender Value Taxble?

Retirement planning with a systematic life insurance plan

Is ULIP a Good Option for People Above 60?

Why are ULIPs One of the Best Tax Saving Instruments?

Managing Your Retirement Income with an insured retirement plan

At What Age Should You Start Your Retirement Planning?

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

8 Charges in ULIP That You Must Know

How Does Pension Plans in India Works?

What are the Instruments Available for Building a Retirement Corpus?

What are the Advantages and Disadvantages of ULIP?

What is an Annuity Plan and How Does Annuity Plan Works | Kotak Life

Why Should I Invest in ULIP?

A Beginner's Guide to Understanding 401k Retirement Plan

ULIP Plan or Traditional Insurance Plans - Which is better?

Best Insurance Plans for a Guaranteed Monthly Income After Retirement!

Advantages of Pension Schemes and Retirement Plans

How Much Corpus Does One Need for Retirement?

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

Pros and Cons of Retirement Annuities

7 Secrets that can Make Your Post-Retirement Phase Prosperous

Types of Pension Plans for Your Retirement

Top Investment Options for Retirement Planning

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

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

5 Reasons to Buy ULIP for a Secured Financial Future

How Can I Achieve My Wealth Goal with ULIP Investment?

Importance of Retirement Planning

What is the Minimum Lock-in Period for ULIP?

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

Top 6 Flexible Benefits That ULIPs Offer

How can NPS help you save tax?

What is ULIP and Its Benefits?

What are the Charges Levied on ULIP?

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

Meaning of Sum Assured in a ULIP

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

Benefits of Early Retirement Plans

What Are Mortality Charges In ULIP?

Can I Surrender My ULIP Policy after 2 Years?

How To Invest Money In ULIP?

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

What is the difference between Life Insurance and ULIP?

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

Save Early to Keep Living Your Dreams Post Retirement

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

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

Benefits of Early Retirement Planning in India

The Significance of Number 8,000 in Retirement Planning

Retirement Planning for Millennials

5 Common ULIP Myths That You Should Stop Believing

Un-Retirement - Are You Ready For It?

Tips to invest your voluntary retirement scheme money

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

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

Importance of financial Planning for Retirement

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

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

What is a Retirement Plan - What are its Features?

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

How Is ULIP Different from Other Life Insurance Plans? Where Can I Invest - ELSS, ULIP, or PPF?

How Safe is it to Invest in ULIP plans?

What tax benefits are there on saving for retirement?

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

Do Pension Plans Allow any Death Benefits?

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

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

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

Benefits Of Retirement & How Investments Can Help You Enjoy Them

How has ULIP Grown Over the Last 3 years?

Which Is Better: ULIP or SIP?

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

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

How Has NPS Performed in Comparison with Other Instruments?

5 Steps to Gift a Smart Retirement Plan to Your Parents

Retirement Planning Guide for Working Men and Women

How to Win at Retirement Savings?

What are the Benefits of ULIP - Explained

Is ULIP A Good Investment Option?

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

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

What are the Uses of ULIP?

What Happens to ULIP Premiums Paid if the Market Crashes?

What are the things to consider before buying ULIPs?

What is Fund Value in ULIP?

Do ULIPs Give Good Returns On Investments?

How To Keep Your Retirement Accounts from Being Hacked?

How Does NPS Work?

Are Annuities Great For Early Retirement?

Top 6 Reasons Why You Should Get A Pension Plan

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

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

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

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

Demystifying the Retirement Planning Process

Can NRIs Invest in ULIP Plans Offered in India?

Give Your Retirement Savings A Booster-Shot with Annuities

Different Types of ULIP Investments in India

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

Is ULIP a Complex Financial Product?

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

Different Types of Retirement Schemes

FAQs on Taxation of ULIPs

What are the Rules for Exit From NPS?

Which are the Best ULIP Plans in India for Children?

How Do Annuity Options Work In NPS

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