4 Benefits of ULIP Fund-Switching Feature
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

4 Benefits of ULIP Fund-Switching Feature

4 Benefits of ULIP Fund-Switching Feature
  • 15th Jul 2022 |
  • 2,600

To secure your future financially, you must begin to save, invest and manage your finances. Investment is vital to put your money to work and create wealth. There are numerous tools available in the financial market to help you meet your financial goal. Everyone wants to increase the value of their savings. However, people often refrain from investing due to the risk involved. What if you are able to invest while minimizing the risk and also getting insurance cover? One such excellent choice is Unit-Linked Insurance Plan. It offers dual advantages of investment and insurance simultaneously. Keep reading to know more about it!

What is ULIP?

Unit-Linked Insurance Plan is an insurance policy that uses a component of your premium to provide insurance and the remaining to invest in different sectors. Based on the kind of investment, ULIPs can be debt-based, equity-based, or a combination of equity and debt called the Balanced fund.

Following are some prominent benefits of ULIPs:

1. The maturity amount received in ULIPs after the lock-in period of five years is tax-free.

2. ULIPs provide flexibility to pay premiums in accordance with your own convenience. Additionally, you can choose low-risk or high-risk investment options according to your risk-taking appetite.

3. You can select short-term or long-term ULIPs according to the duration of your financial goals.

4. ULIPs offer transparency to the policyholders with regular NAV updates that help them to track the performance of their funds.

5. You can make a partial withdrawal from your ULIP policy in case of an unexpected event.

Among numerous advantages of the ULIP, one of the most useful features is the ability to switch funds. The liberty to switch funds allows you to tailor your investments according to your preferences. You can customize your investment in the best way it suits you.

How to make fund switches?

To maximize your returns and minimize the loss, you must know when to transfer your units. It is not possible to predict the market fluctuations accurately, but one can make the switch by tracking their NAV updates. Net Asset Value (NAV) is declared by the insurer on a regular basis and makes the policyholder aware of their fund’s performance.

One can switch the funds on the official website of the Insurance company. Alternatively, you can fill out the required form and submit it at the nearest branch to transfer your funds.

Benefits of the ULIP Fund Switching Feature of ULIP:

Protect your Investment from the Market Volatility

Most investors refrain from investing due to the market fluctuations affecting the performance of their funds. However, the fund switching feature of ULIP allows you to modify your investment and minimize the loss.

Accomplish your Financial Goals

Financial goals are the objectives you set to accomplish over a certain period. Short-term goals can be achieved in a short period, while long-term goals can take several years to be fulfilled.

ULIPs invest your funds in equity, debt, or balanced funds depending upon your budget, risk-taking appetite, and duration of your financial goals. With the fund switching benefit of ULIPs, you can transfer your units fully or partially between these different options while aligning your portfolio with your life goals.

Invest According to your Risk-Taking Appetite

You can switch funds anytime and modify your investment according to your income, budget, and risk-taking appetite. For instance, one can afford to take a higher risk at a younger age but might want to switch to a low-risk option later. ULIPs allow you to switch to debt-based types that involve low risk and vice versa.

Tax-Free Transfer

ULIPs not only offer tax-free returns on the maturity benefit but also allow you to switch your funds with almost no tax applicable. Moreover, it does not attract any capital gains tax, hence letting the policyholders make multiple tax-free switches.

Hence, you can easily switch your funds and allocate your assets according to your preferences in the Unit-Linked Insurance Plan. As a result, you can minimize the risk and maximize the returns according to the performance of your funds in the capital market.

Kotak e-Invest

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

Features

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

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

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

What are Deferred Savings Plans?

Which is a Better Investment - Mutual Funds Or ULIP?

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

How Do One-Time Investment Plans Work?

Are Gains from ULIP Sale Taxable?

Long Term Savings Plan - Best Savings Investment Plans in India

Debt ULIPs vs. Debt Mutual Funds: What's the Difference?

Top 5 Principles That Need to be Followed for Wealth Creation

Top 10 Investment Strategies to Create Wealth

Safe Investment Options with High Returns for FY 2018-19

How to Plan Your Child's Education - A Step by Step Guide

Top 6 Investment Plans Available in India

ULIP Plan as a Gift

Short Term and Long Term ULIP Plans for Wealth Creation

What are the Best Investment Options for Students in India?

What is ULIP Renewal?

How to Make Your Financial Portfolio?

Endowment Plan vs Fixed Deposit?

ULIP Benefits You Can Avail from Early Investing

Receiving regular payouts at various stages of life

Early Investing and the Power of Compounding

ULIP as an Investment for Your Child

What are Tax-Deferred Savings Plans?

Why is Portfolio Diversification Important? How to Diversify Your Portfolio?

Successful Financial Planning for Urban Women

What are the Best Investment Options for Young Adults?

What is better - Guaranteed Savings Plan or Fixed Deposit?

How to Plan Savings from Salary?

How to Cancel ULIP Policy?

Benefits of ULIP as a Child Insurance Plan

Best One-Time Investment Plans in India

Savings Plan for Grandchildren

Basics of Guaranteed Savings Plan

Which is Better – FD, Mutual Fund, SIP, or ULIP?

Which are the Best Investment Plans for Indian Senior Citizens In 2022?

Who Should Invest in Savings Plan?

Things to Know Before Buying an Endowment Plan

Asset Allocations in ULIP - Know the Top Benefits

Top 5 Investment Options in 2022 for Healthy Returns

Why Should Parents Invest in Endowment Plan?

Creating a second source of income with life insurance

Planning Financial Goals and Objectives of Financial Planning

4 Important Tips to Maximize Gains with ULIP Investments

Why Do You Need A ULIP Plan - All You Need To Know

3 Tips to Buy Guaranteed Savings Plan

How To Track ULIP Performance?

Investments Options to Buy a house in India

Are Money Back Policies Helpful? A Complete Guide

Difference Between Guaranteed Savings Plan and ULIP

How to Start Saving Money in 10 Simple Ways?

Is This The Right Time To Invest In ULIP? Why or Why Not?

How to Fulfil Your Financial Goals in the Next 10 Years?

Best Investment Options in India in 2022

ULIP vs FD - Which is Better and Why?

How To Diversify Portfolio In 2022?

What is a Savings Plan and What are is Benefits?

Learn About Safe Investments with High Returns in India

How is Compoud Annual Growth Rate (CAGR) Calculated in ULIP?

Beginner's Guide to Wealth Creation: Meaning, Strategies, & Importance

What is Fund Switch in ULIP? And ULIP Fund Switching Techniques

Why Should You Consider Guaranteed Savings Plan for Long-Term Investment?

How Does an Endowment Plan Work?

Investment Options for NRIs in India

How to Plan your Investment to Achieve Periodic Financial Goals?

Best Investment Options to Cover Your Child's Education

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

Building wealth through regular investing

Complete Savings Plan for Low Income Earners

How to Manage Inheritance Money?

Why ULIP is Better Investment for Long-Term Wealth Creation?

Do You Know the Difference Between Savings and Investment?

What are the Best Investment Options for Beginners or Amateur Investors in India?

What is the Importance of Saving Money?

What are the Best Investment Options For Females?

How to Manage Your Portfolio Like a Professional?

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Can ULIP Help in Achieving Short-Term Financial Goals?

Planning for Your Child's Higher Education? Explore These Investment Options

Customising investments to manage your wealth

What's Better for Your Child's Education? Child Plans or Mutual Funds?

Difference Between Passive and Active Investing

How Much Wealth Can You Create from ULIP in 10 years?

What are Some of the Safest Investment Options in India?

Learn About Safe Investments with High Returns in India

What are the Best Short-Term Investment Plans with High Returns?

Why Should You Invest in Term Insurance And ULIP?

How Can a Legal Nominee Claim ULIP Benefits are the Policyholder’s Death?

Different Types of Endowment Plans

How to Increase Net Worth Along with Family Protection

Importance of Portfolio Management

Important Questions You Must Ask Yourself When Buying a ULIP Plan