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5 Reasons to Buy ULIPS for a Financially Secured Future

ULIP offers benefits ranging from life insurance to wealth creation & tax savings. Here are five more reasons to invest in ULIP.

  • 5,208 Views | Updated on: Jan 10, 2024

Financial stability and security are important aspects of a peaceful and happy life today. Well-being and having enough resources to survive any emergency is important for yourself and your family. For many, having good savings to support their family and themselves is the primary goal. The secondary goal is to ensure a good future for your dear ones.

However, planning the future is not as simple as it sounds. Future is uncertain, and certain complications can always derail your plans. To tackle such unforeseen scenarios, we need to make right investments that get us returns at the right time. This is where plans like Unit Linked Insurance Plans come into the picture.

Now there are many things that you must clarify before opting for a ULIP policy. First, you need to understand the answer to the question, “Why should I invest in ULIP?”. Once you have an idea about why, you can further check on why is ULIP a good investment. Again, identification of ULIP’s pros and cons is also equally important.

Reasons to Buy ULIPs for a Secured Financial Future

In this article, we will give you 5 reasons for investing in an ULIP plan.

5 Reasons for Securing Financial Future with Unit Linked Insurance Policy

Here are five reasons why ULIP is getting popular nowadays and why you should invest in ULIP now:

1. ULIP offers the ability to invest in market-linked funds

ULIP allows you to invest in market-linked funds like equity, debts, hybrid investment. A part of the premium you pay for ULIP is invested in the market securities. Thus, if you are looking for long-term financial growth and taking benefit of markets’ growth over the years, then ULIP is a safe and reliable way to earn good returns.

2. Full-control over your investment with ULIP

Now, if you ask Why ULIP is best? The right answer would be because of its important features. In this case, when you opt for ULIP, you have full control over the investment part of the ULIP policy. You can manage your portfolio as per your choice. In ULIP, you get to choose the funds you want to invest in and switch them according to your wish. So, you can identify your risk appetite and accordingly invest in the equity, debts, or hybrid market funds.

3. ULIP offers additional benefits for staying invested

The reward that you get for staying invested in unit linked insurance policy is also one reason why ULIP is a good investment. In addition, you get rewarded for continuing in the policy after your maturity as you are awarded a wealth booster and loyalty bonus. It is advised to check for these benefits before opting for a ULIP policy, as different insurers offer different benefits and features.

4. ULIP offers life insurance along with investment

Apart from the investment part, you should not ignore that you are getting life coverage. The combination of investment and life insurance makes ULIP a modern and popular financial plan. You get a minimum life cover of 10 times of your annual premium amount. Moreover, the life insurance has to be decided by you based on your goals and the requirement in case of your untimely demise.

5. Tax benefits with ULIP

When you invest in ULIP, you get EEE (Exempt-Exempt-Exempt) tax benefits of an annual premium of up to ₹1.50 lacs as per Section 80C deduction. Also, you are exempted from tax on all premium, maturity, and proceeds.

With these and many other benefits, Unit-Linked Insurance Plans prove to be ideal investment solutions for individuals with varying risk appetites. You need to analyse your requirements, determine the value you can invest, and find the right funds to invest in.

- A Consumer Education Initiative series by Kotak Life

Amit Raje
Written By :
Amit Raje

Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.

Amit Raje
Reviewed By :
Prasad Pimple

Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors

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

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