Importance of Unit Linked Insurance Plan |What is ULIP - PNB MetLife Insurance

Importance of ULIPs

Importance of ULIPs

What is ULIP?

ULIP refers to Unit Linked Insurance Plan which is a combination of insurance and investment. It involves a monthly or annual premium monthly. Out of this premium a small amount is dedicated towards life insurance while the remaining is invested as in a mutual fund.

Here is why you should invest in ULIPs

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  • ULIP allows you to customise your saving’s schedule by making use of its features such as withdrawals, multiple fund options, different premium payment options and modes.
  • By making monthly investments it inculcates the habit of investing. This also helps in averaging the costs of units. To pay any investible surplus available you can use the top up option. Not only do they reduce the overall cost for the policy holder but also increase the life cover.
  • You can estimate one’s insurance requirement by using the Human Life Value Calculator and then decide on an amount to fulfill your future financial needs,so that you can adjust them during inflation.
  • The premium paid is invested in one or more fund options in a ULIP post the applicable charges. These fund options have varying asset locations between equity and debt which ensures that a portion of your money is secure at all times.

A single ULIP if used well can take care of one’s future goals at different life stages. By investing in a single ULIP you can exempt yourself from the administrative costs incurred every time you buy a new ULIP. ULIPs offer flexibility and transparency which make them the perfect choice to invest in the market.