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


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.

What are ULIPs and their Types?

A highly wise investing approach is to have a complete life insurance policy on yourself and to use your unused funds as well. There are distinct sorts of ULIPs that can be characterized in many ways. A ULIP, full form- Unit-Linked Investment Plan, is a g

  • Mar 02, 2022

A ULIP, full form- Unit-Linked Investment Plan, is a great investment option since it mixes insurance and investment. A part of the premium amount provides you with insurance coverage, while the remainder is invested in the stock market. Because a portion of the premium is constantly invested in the stock markets over time, the potential for returns is substantially higher than with other investments.

    Key takeaways

    Types of Funds

  • Equity
  • Debt
  • Liquid Funds
  • Balanced Funds
  • Cash Funds
  • Based on the Investment Objectives

  • To fund your child’s education
  • To build a corpus of funds
  • ULIP types based on wealth creation

  • Single premium and regular premium ULIPs
  • ULIPs for different stages of life
  • ULIPs with and without guarantees
  • To plan for retirement
  • To meet medical or personal emergencies

There are different types of ULIPs in India to suit various financial goals and risk profiles. In general, ULIP plans are categorized according to the types of funds in which your premium is invested or their ability to build wealth.

Types of Funds

The most popular types of unit-linked insurance plans in India are briefly described here:


Investors’ money is used to buy equity shares. Since investments in equity are directly linked to financial market changes, they prove to be highly risky. However, the potential for expansion is comparatively larger. Therefore, ULIP plans that invest in equity are appropriate for risk-friendly investors with a high-risk tolerance.

2. Debt

Debentures, corporate or government bonds and securities, and fixed-income bonds are among the debt instruments in which the funds are invested. Though these instruments have a medium to low-risk profile, they also include a moderate return profile.

3. Liquid Funds

These ULIP plans are ideal for reaching short-term financial goals since they invest in highly liquid money market products. These funds have a shorter maturity period (from weeks to months). Most of these ULIP investments have high credit ratings, making them a safe investment option for those with a low-risk tolerance profile.

4. Balanced Funds

Some ULIP plans invest in a combination of equities and debt assets to reduce risk. The risk is effectively spread across high-risk and low-risk investment avenues by allocating a part of the amount to equity and the other part to fixed-income debt instruments.

5. Cash Funds

These funds are invested in very low-risk cash fund instruments. While the profits are the lowest of all the available possibilities, the risk is also the smallest, making them an excellent alternative for risk-averse investors who aim to reduce risk as much as possible.

Based on Wealth Creation

1.Single premium and regular premium ULIPs

The former requires only a single premium payment at the time of purchase. On the other hand, the latter permits you to pay premiums regularly throughout the plan’s life, from purchase through maturity.

2. ULIPs for different stages of life

These are based on the premise that the risk-taking ability of investors decreases with their age. Therefore, a portion of the premium paid is invested in equity securities, while the rest of the amount is invested in debt instruments.

3. ULIPs with and without guarantees

Guaranteed ULIPs are concerned with capital preservation. By investing a small amount of the premium in equities, they restrict the exposure to market risk. However, non-guaranteed ULIPs are designed to maximize wealth creation by enabling investors to invest a larger amount of their premium in the financial market. As a result, non-guaranteed ULIPs have higher returns, but they are more volatile.

4. To plan for retirement

A retirement corpus building Unit-Linked Investment Plan (ULIP full form) can save you if your regular source of income quits and you’ve reached the end of your working years. There are particular ULIP programs created to care for you in your latter years. After the plan expires, they still offer regular payouts, and you will still get enough money to live comfortably. You won’t fully appreciate the advantages of working for money and having money work for you until these payments begin.

5. To meet medical or personal emergencies

There are occasionally significant expenses that we cannot avoid. When you least expect it, unexpected things like medical problems, accidents, legal costs, settlement amounts, debt, etc., can truly hit you hard. There are programmes that assist you in creating a corpus that you can utilise in place of a health insurance policy. The plan enables you to partially withdraw from your greater maturity corpus to cover the urgent expense if you are in the hospital and require rapid cash.

ULIPs Based on the Investment Objectives

1.To fund your child’s education

One of the more well-known advantages of choosing a ULIP is that it satisfies the criteria for protecting your dependents and children from financial hardship in the event of your passing and designs payouts so that they will be used for the appropriate purpose. Once a year, these ULIPs often pay benefits out when they are required for the intended use.

2. To build a corpus of funds

It is one of the most important types of unit-linked insurance plans that can be used to put unused savings to work, and one that also offers the option of life insurance protection effectively kills two birds with one stone. People typically let the insurance company manage their savings rather than going through hell to find the proper investment with the right interest rate and term.

When tackled through the conventional technique of hard labour, building a sizable corpus is a time-consuming endeavour. ULIPs, however, limit your involvement in the administration of money and allow you to share in the profits.


These categorizations convey that you can pick the right type of unit-linked insurance plan that meets your risk tolerance and long-term financial objectives. In addition, you can invest in a ULIP full form (unit-linked insurance plan), which allows you to pick from various funds with varied risk and reward formulae. As a result, they make informed decisions and take advantage of market fluctuations.

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

Best Insurance Plans for a Guaranteed Monthly Income After Retirement!

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

Inflation: A Key Factor to Consider into Retirement Planning

Types of Pension Plans for Your Retirement

FAQs on Taxation of ULIPs

How Can I Achieve My Wealth Goal with ULIP Investment?

What is Fund Value in ULIP?

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

What Are Retirement Pension Plans?

What are the Rules for Exit From NPS?

What Are Superannuation Benefits?

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

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

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

What Happens to ULIP Premiums Paid if the Market Crashes?

Are Annuities Great For Early Retirement?

Do ULIPs Give Good Returns On Investments?

How Does NPS Work?

How To Choose The Right Pension Plan?

Why ULIP Should Be a Part of Your Investment Portfolio?

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

Is ULIP A Good Investment Option?

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

How Does Pension Plans in India Works?

Calculating a Retirement Corpus that can Support Your Lifestyle

What are the Instruments Available for Building a Retirement Corpus?

Different Types of Retirement Schemes

What are the Uses of ULIP?

How Does ULIP Work in India?

Top 6 Reasons Why You Should Get A Pension Plan

8 Charges in ULIP That You Must Know

Can I Surrender My ULIP Policy after 2 Years?

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

How can NPS help you save tax?

5 Reasons to Buy ULIP for a Secured Financial Future

What are the Advantages and Disadvantages of ULIP?

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

Benefits of Early Retirement Planning in India

ELSS vs ULIP: Which is a Better Investment?

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

Is ULIP a Complex Financial Product?

How should one decide on fund allocation within NPS?

Retirement Planning at 50? You Are Still Good to Go

Terminologies You Should Understand About Retirement Plans

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

A Quick Guide to Retirement Plans

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

EPF Grievance Management: All You Need to Know

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

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

What is the difference between Life Insurance and ULIP?

What Are Mortality Charges In ULIP?

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

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

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

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

Top 4 Mistakes To Avoid While Planning For Your Retirement

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

5 Notable Investment Options for Retirees

Long Term Investment Guide for Your Retirement

What are the things to consider before buying ULIPs?

How to Win at Retirement Savings?

ULIP Plan or Traditional Insurance Plans - Which is better?

Is the ULIP Policy Surrender Value Taxable?

What is a Defined Benefit Plan and How it Works?

What is a Retirement Plan - What are its Features?

Saving for approaching retirement with retirement insurance

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

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

Which Is Better: ULIP or SIP?

What is the Minimum Lock-in Period for ULIP?

How has ULIP Grown Over the Last 3 years?

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

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

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

Retirement: A New Start to Life!

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

Invest for your second innings with a guaranteed savings plan

Is It Worth Buying ULIP Plans For 10 Years?

Why You Should Invest In An Annuity Plan?

What are the Differences Between ELSS ULIP and Mutual Funds?

Top Investment Options for Retirement Planning

Top 4 Myths About ULIP Investments You Should Know

Benefits of Early Retirement Plans

Un-Retirement - Are You Ready For It?

Benefits Of Retirement & How Investments Can Help You Enjoy Them

Meaning of Sum Assured in a ULIP

यूलिप के 8 शुल्क

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

Which Pension Plan Suits You best?

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

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

Types of Retirement Plans

Top 6 Flexible Benefits That ULIPs Offer

7 Secrets that can Make Your Post-Retirement Phase Prosperous

Retirement Planning: Use our Retirement Calculator to Plan Ahead

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

NPS for Housewife

Know Why You Should Stay Invested in Your ULIP Plan

Save Early to Keep Living Your Dreams Post Retirement

How Much Corpus Does One Need for Retirement?

How To Keep Your Retirement Accounts from Being Hacked?

Do Pension Plans Allow any Death Benefits?

Tips to invest your voluntary retirement scheme money

How Has NPS Performed in Comparison with Other Instruments?

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

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

5 Steps to Gift a Smart Retirement Plan to Your Parents

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

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

What are the Benefits of ULIP - Explained

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

5 Common ULIP Myths That You Should Stop Believing

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

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

How To Make Most of Your Money After Retirement?

At What Age Should You Start Your Retirement Planning?

Importance of Retirement Planning

Demystifying the Retirement Planning Process

A Beginner's Guide to Understanding 401k Retirement Plan

Is ULIP Better Than FD?

Retirement Planning Guide for Working Men and Women

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

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

Different Types of ULIP Investments in India

Understanding Annuity Plans

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

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

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

Can NRIs Invest in ULIP Plans Offered in India?

Advantages of Pension Schemes and Retirement Plans

Retirement planning with a systematic life insurance plan

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

What is Lock-In Period in ULIPs?

What tax benefits are there on saving for retirement?

The Significance of Number 8,000 in Retirement Planning

Pros and Cons of Retirement Annuities

What is Partial Withdrawal in ULIPs?

Retirement Planning for Millennials

How Do Annuity Options Work In NPS

Is ULIP a Good Option for People Above 60?

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

Why Should You Invest in NPS?

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

How Safe is it to Invest in ULIP plans?

What are the Charges Levied on ULIP?

Importance of financial Planning for Retirement

Give Your Retirement Savings A Booster-Shot with Annuities

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

Ten Signs That You're Ready to Retire