Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak Guaranteed Fortune Builder

A plan that offers guaranteed income for your future goals. Know more

Kotak e-Term

Protect your family's financial future. 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 life cover. Know more

Kotak e-Invest

Insurance and Investment in one plan. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more

Close

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.

ULIP NAV - Everything You Need to Know

ULIP NAV - Learn how to determine net asset value in ULIPs and what it means. Your ULIP's performance is accurately reported by NAV.

  • Mar 25, 2022
  • 2,760 Views

Unit Linked Insurance Plan or ULIP is one of the popular investment tools that has recently gained popularity after the new regulations that the government brought in Budget 2022 to control its misuse. Also, ULIP returns are decent, making them a good choice for investors. However, it is important to understand the key details of ULIP before planning an investment in this plan.

One of the aspects of ULIP that are a bit confusing is calculating ULIP returns. In this article we will help you understand how to calculate ULIP returns. We will also discuss ULIP performance, the benefits of ULIPs, the best ULIP plans in India, and the tax advantage of ULIPs in brief.

What is Net Asset Value?

When referring to open-end or mutual funds, net asset value (NAV) is the sum of an entity’s assets less its liabilities.

The difference between assets and liabilities for businesses and other legal entities is referred to as the company’s capital, net worth, or net assets. The fund valuation and price, which are determined by dividing the difference between assets and liabilities by the number of shares held by investors, are referred to as NAV.

It is simpler to use the fund’s NAV for pricing and trading fund shares because it represents a “per-share” value of the fund.

How is ULIP calculated?

ULIP is a 2-part investment plan. It means that one part of the investor’s premium is allocated towards insurance. The remaining premium amount goes towards investment, which manages portfolios of different market funds like debts, equities, hybrid funds, etc.

The investor manages the investment part, and the return depends on how the fund portfolio is managed. The whole return calculation is based on the NAV of the ULIP policy.

NAV or Net Asset Value is the value of assets of your ULIP funds, excluding its liabilities. Another term used to denote NAV is book value.

ULIP NAV Formula:

NAV = (Value of Current Assets + Market Value of Investments Held) - {(Value of Current Liabilities & Provisions) / Total number of outstanding units on the date (before redemption/creation of units)}

The NAV is calculated on a daily basis as the value of market funds changes every day.

Steps to calculate ULIP returns using NAV

To check ULIP performance, it is important to understand how the value of ULIP is calculated. The simplest way to calculate the value of ULIP returns is to use an online ULIP return calculator.

However, these calculators sometimes provide very limited functionality, and if you want to calculate the exact value of your ULIP, you will have to calculate it on your own.
Choose a date for valuation that fits your needs. (As NAV is calculated on the fund valuation of a particular date)

Here is a stepwise method to calculate the exact value of your ULIP NAV:

Step 1:

Choose a date for valuation that fits your needs. (As NAV is calculated on the fund valuation of a particular date)

Step 2:

Now, calculate fund securities using the formula below:

Total Value of Fund Securities at the end of valuation date = (Cash on Hand on valuation date) + (Short-term and Long-term assets held by the fund)

Step 3:

Subtract outstanding liabilities of ULIP Funds. Use the formula below for this:

Total Value of Fund Securities at the end of valuation date = [(Cash on Hand on valuation date) + (Short-term and Long-term assets held by the fund) - Outstanding Fund liabilities]

Step 4:

Now divide the above value by the outstanding share in your ULIP funds. You will get the following:

NAV = [(Cash on Hand on valuation date) + (Short-term and Long-term assets held by the fund) - Outstanding Fund liabilities] / number of outstanding shares in the ULIP fund

Thus, the final NAV of your ULIP fund is obtained.

To obtain the market value of your investment, you will have to multiply the NAV value obtained above the number of shares you own.

The total market value of investment = NAV x Number of shares owned

Having understood calculating your investment’s market value, you can calculate the exact value of your ULIP investment and plan your next moves accordingly. Moreover, you will not have to depend on the limited features of the online ULIP return calculator to check your ULIP performance.

How is ULIP Calculated? 4 Methods to Calculate your ULIP NAV

ULIP can be considered a good option as a financial tool. However, among the various benefits of ULIPs, like good returns, one of the most important ones is the tax advantage of ULIPs. Therefore, checking these benefits, calculations, and deductions is suggested before opting for a ULIP policy.

FAQs


1

What is the formula used for NAV calculation?

The total worth of all the cash and securities in a fund’s portfolio, less any liabilities, is divided by the number of outstanding shares to arrive at the NAV.



2

What is the meaning of ‘Unit’ in Unit-Linked Insurance Plans?

A ULIP is a sort of insurance that covers both investing opportunities to help you meet your long-term goals and the financial security of your family. There are two portions to the premium paid for a ULIP.



3

How is fund value calculated in ULIP?

The entire monetary value of all the units a policyholder holds is the total fund value of a ULIP. Simply multiply the number of units held by the NAV (Net Asset Value) of a single unit on that specific day to determine the fund value in a ULIP on a given day.


4

What is the formula for the calculation of NAV?

The total worth of all the cash and securities in a fund’s portfolio, less any liabilities, is divided by the number of outstanding shares to arrive at the NAV.


5

Why is net asset value important?

An investment fund’s NAV, or net asset value. NAV is used by mutual funds and ETFs to determine the cost per share of the fund.

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

Kotak e-Invest

Download Brochure

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

- A Consumer Education Initiative series by Kotak Life

Similar Articles

ULIP As An Investment Option For Senior Citizens

How to Apply for Death Claim Benefits in ULIPs - Kotak Life

How to Start Saving Money in 10 Simple Ways?

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

Know How to Invest at Every Age for Larger Returns

Do ULIPs Give Good Returns On Investments?

What is Fund Value in ULIP?

How To Track ULIP Performance?

Learn About Safe Investments with High Returns in India

Top 11 Investment Plans Available in India

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

What is a Bond Fund and How It Works?

Savings Plan for Grandchildren

Corporate Bonds: Meaning, Types & Benefits

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

What are the Best Investment Options For Females?

Best Investment Options to Cover Your Child's Education

How to Cancel ULIP Policy?

What is Money Management? Definition & Example

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

What Is a Credit Score? Definition, Factors, and Ways to Raise It

How has ULIP Grown Over the Last 3 years?

6 Important Tips to Maximize Your Gains with ULIP Investments

What are Some of the Safest Investment Options in India?

Rate of Interest on Different Investment Plans in India

What is a Savings Plan and What are is Benefits?

Is Life Insurance Investment Worthy Enough

What is Savings and the Importance of Saving Money

Top 5 Principles That Need to be Followed for Wealth Creation

Is the surrender value of ULIP taxable?

Balancing Investment Between Risk and Return on Investments

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

Why Are ULIPs Called Flexible Investments?

Here's Myths on Investments in ULIP Plans

How to Plan your Investment to Achieve Periodic Financial Goals?

FAQs on Taxation of ULIPs

What are Financial Assets & their types?

Investment Options for NRIs in India

Long Term Savings Plan - Best Savings Investment Plans in India

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Top 10 Investment Strategies to Create Wealth

Are Money Back Policies Helpful? A Complete Guide

What is the Time Value of Money (TVM)?

Difference Between ULIP and Endowment Plan?

Best Investment Plans For You To Invest In 2023

Top ULIP Myths That You Must Stop Believing In

How Can ELSS Funds Help You Save Tax & Create Wealth?

Are Gains from ULIP Sale Taxable?

Best One-Time Investment Plans in India

Asset Allocations in ULIP - Know the Top Benefits

What are the Best Investment Options for Young Adults?

ULIP Investment Benefits You Must Know

Best Investment Plans for Children - Secure Your Child's Future

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

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

What Is Financial Planning?

What are ULIPs and their Types?

यूलिप के फायदे और नुकसान क्या हैं?

What are the Advantages and Disadvantages of ULIP?

Difference Between Passive and Active Investing

5 Best Long Term Investments To Add To Your Portfolio in 2023

How Can ULIP Plan be as an Investment for Your Child

Factors Affecting Share Prices In The Stock Market

Can You Have ULIP Plan and Health Insurance Plan Both?

8 Charges in ULIP That You Must Know

ULIPs Investment – A Boon or Bane?

Can NRIs Invest in ULIP Plans Offered in India?

The lesser-known facts about ULIP policy that customers should be aware of?

How to Save Money from Salary?

Importance of Portfolio Management

What is Direct Investment and its Types?

ULIP Plan or Traditional Insurance Plans - Which is better?

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

What is a Child Money Back Plan, and How Does it Work?

Endowment Plan vs Fixed Deposit?

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

What is Mutual Funds? | How Mutual Funds Work, Definition

What is ULIP Plan, and How Does it Work?

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

यूनिट लिंक्ड इंश्योरेंस प्लान में लॉयल्टी एडिशन कैसे काम करते हैं

Difference Between Linked and Non-Linked Insurance Plans

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

What is ULIP and Its Benefits?

How to Build a Strong Financial Foundation For the Future?

How to Increase Net Worth Along with Family Protection

ULIP vs FD - Which is Better and Why?

How to Manage Your Portfolio Like a Professional?

Planning Financial Goals and Objectives of Financial Planning

All you need to know about claiming maturity proceeds from Ulip

What are the Minimum and Maximum Investments in ULIP?

What are the Best Investment Options for Students in India?

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

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

What Is Social Impact Investing and How Does It Benefit Society?

How to Create Short-Term and Long-Term Wealth with ULIPs - Kotak Life

Can You Invest in Both Term Insurance and ULIP?

Do You Know the Difference Between Savings and Investment?

Successful Financial Planning for Urban Women

Can I Surrender My ULIP Policy after 2 Years?

Top 5 Investment Options in 2022 for Healthy Returns

Which is a Better Investment - Mutual Funds Or ULIP?

What are the things to consider before buying ULIPs?

How to Set Financial Goals for Your Future

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

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

Will AI be Your Future Financial Adviser? What Role Will Humans Play?

How ULIPs can help you achieve your financial goals

Planning For Children's Future

Receiving regular payouts at various stages of life

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Can ULIP Policy be Transferred?

5 Reasons to Buy ULIPS for a Financially Secured Future

Can ULIP Help in Achieving Short-Term Financial Goals?

ULIP Benefits You Can Avail from Early Investing

Here's Why it's a Good Time to Explore ULIPs as an Investment

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

All you need to know about Fund Switching in ULIPs

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

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

ULIP Withdrawal Conditions - Before and After 5 years

How to Make Your Financial Portfolio?

Here's are the uses of ULIP your must be aware of

ULIP Plans Riders You Should Know About

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

ULIP Plan as a Gift

What is Partial Withdrawal in ULIPs?

What is Equity Mutual Funds: Meaning, Types & Benefits

Why are ULIPs One of the Best Tax Saving Instruments?

Difference Between Guaranteed Savings Plan and ULIP

Benefits of ULIP as a Child Insurance Plan

Understanding ULIP Risks: What are the Odds of Losing all my Money and Projected Returns?

What is SIP Calculator, and How it Works?

Does Rupee Cost Averaging Work In Unit-Linked Insurance Plans?

Develop an investing plan

ULIPs: Suitable for all

Creating a second source of income with life insurance

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

How to Manage Inheritance Money?

Know Why You Should Stay Invested in Your ULIP Plan

Learn About Safe Investments with High Returns in India

वित्तीय संपत्तियां और उनके प्रकार

Got a Salary Hike? Here’s How to Plan your investment further

How Increasing Your SIP Every Year Helps You Reach Your Financial Goal Sooner?

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

ULIP policy: What happens when you stop paying ULIP policy premium during lock-in period

Here's Whether You Should Link ULIP Plan with your Term Insurance

Why ULIP Should Be a Part of Your Investment Portfolio?

Four Financial Lessons from The Vedas on Living Life to The Fullest

Different Types of ULIP Investments in India

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

Are Investment Returns Guaranteed in a ULIP?

How Safe is it to Invest in ULIP plans?

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

What is Lock-In Period in ULIPs?

Planning For Son or Daughter's Wedding

What are loyalty additions, and how do they work in a ULIP?

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

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

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

8 Important Tips to Maximize Gains with ULIP Investments

How Do One-Time Investment Plans Work?

How To Invest Money In ULIP?

Is ULIP a Complex Financial Product?

Safe Investment Options with High Returns for FY 2018-19

Customising investments to manage your wealth

Building wealth through regular investing

How to Calculate Your ULIP Returns?

Unit-Linked Life Insurance (ULIPs) vs. Term Insurance

ULIP Vs Life Insurance Plan Know the Difference

Early Investing and the Power of Compounding

Why Should I Invest in ULIP?

Which are the Best ULIP Plans in India for Children?

What is ULIP Renewal?

How to Use Recurring Investment Strategies to Build Wealth?

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

5 Reasons to Have a Child Education Plan

Will You Need to Withdraw or Surrender Money From ULIP

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

Why Should You Build an Emergency Fund?

First Job? Here are Some Tips on How to Manage Finances

4 Rules To Keep In Mind To Secure Your Child’s Future Financially

Best Investment Options in India in 2022

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

How to Fix the 9 Most Common Financial Problems Your Family is Facing

Why Should You Invest in NPS?

Tax-Deferred Savings Plan: Overview, Benefits, Works

ULIP Frequently Asked Questions (FAQ) - Kotak Life

यूलिप के फायदे (Benefits of ULIP in Hindi)

यूलिप प्लान में परिपक्वता लाभ क्या हैं: फंड वैल्यू सम एश्योर्ड या ओनली फंड वैल्यू?

Is ULIP A Good Investment Option?

What is Compound Interest, And How Do I Calculate it?

यूलिप और उनके प्रकार क्या हैं?

Investments Options to Buy a house in India

ULIP Capital Gain Tax: Check Tax Norms for Capital Gain on ULIPs

How and when should you exit from bad-performing ULIP?

What are Index Funds, and How Do They Work?

यूलिप में 8 शुल्क जो आपको अवश्य जानना चाहिए