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Benefit of ULIPs
Unit Linked Insurance Plans (ULIPs) offer a unique combination of insurance and investment, making them a popular choice for individuals looking to secure their financial future. These versatile financial products not only provide life insurance coverage but also offer the potential for significant wealth creation through market-linked investments. Understanding the benefits of ULIPs can help investors make informed decisions about their financial planning. From tax advantages to investment flexibility, ULIPs present a range of benefits that cater to diverse financial goals and risk appetites, ensuring a balanced approach to saving and investing.
ULIP Plans
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15.8 Crore
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In-Built life cover
Top performing plans˜ with High Returns**
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- Benefit of ULIPs
List of ULIP Funds ~
Fund Name
AUM
NAV
Returns (in %)
3 Year
5 Year
10 Year
Midcap Fund
SBI Life
AUM:67,697 Cr
67,697 Cr
NAV
51.54
-0.01%
Returns
16.5%
Highest Returns
Opportunities Fund
HDFC Life
AUM:35,621 Cr
35,621 Cr
NAV
80.4
0.24%
Returns
12.61%
High Growth Fund
Axis Max Life
AUM:16,228 Cr
16,228 Cr
NAV
126.54
0.06%
Returns
19.57%
Opportunities Fund
ICICI Prudential Life
AUM:3,711 Cr
3,711 Cr
NAV
60.64
-0.12%
Returns
12.09%
Highest Returns
Multi Cap Fund
Tata AIA Life
AUM:12,199 Cr
12,199 Cr
NAV
68.88
-0.12%
Returns
14.71%
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Disclaimer :
˜The insurers/plans mentioned are arranged in order of highest to lowest first year premium (sum of individual single premium and individual non-single premium) offered by Policybazaar’s insurer partners offering life insurance investment plans on our platform, as per ‘first year premium of life insurers as at 31.03.2025 report’ published by IRDAI. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the IRDAI website www.irdai.gov.in
What are ULIPs?
Unit Linked Insurance Plans (ULIPs) are financial products that combine investment and insurance in a single plan. Offered by insurance companies, ULIPs allocate a portion of the premium paid towards life insurance coverage, while the remaining amount is invested in a variety of assets, such as market-linked funds. The performance of these investments determines the returns on the ULIP, which can vary based on market conditions. ULIPs offer policyholders the flexibility to switch between different funds, allowing them to adjust their investment strategy according to their risk appetite and financial goals. They usually come with a lock-in period of five years, ensuring a disciplined approach to long-term savings. Furthermore, ULIPs provide tax benefits under Sections 80C and 10(10D) of the Income Tax Act, making them an attractive option for individuals seeking both protection and growth for their investments.
Benefits of ULIPs
Below are the ULIP Plan benefits:
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Flexibility: ULIPs offer a variety of investment options to suit your risk tolerance and financial goals. You can choose how to invest your premium among equity, debt, or balanced funds. Risk tolerance defines the best SIP investment strategy. You can also switch between funds to maximize returns. Additionally, some ULIPs allow you to increase your life insurance coverage over time.
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Transparency: ULIPs provide clear information about charges and benefits. You can get a benefit illustration that shows how your premium is used and potential returns based on your chosen options. Product brochures and key feature documents explain the plan in detail. There's also a free-look period to review the policy and get a full refund if you're not satisfied. Finally, daily updates on the Net Asset Value (NAV) help you monitor your investment performance.
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Goal-based Savings: ULIPs encourage regular savings to achieve your long-term goals, like retirement planning or your child's education. By setting up a ULIP, you commit to disciplined investing and avoid using the money for short-term needs.
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Death Benefit: In the unfortunate event of your passing, ULIPs provide a death benefit to your designated beneficiary. This financial cushion can help your loved ones maintain their financial well-being during a difficult time. The payout is usually the higher of the sum assured or the fund value at the time of death, or whichever is higher, thus offering a layer of security for your dependents.
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ULIP Tax Benefits: ULIPs offer tax advantages throughout the investment. You can get tax deductions for premiums paid under Section 80C. The returns on your investment and any switches between debt and equity funds within the ULIP are not taxed. Maturity benefits are also tax-free under Section 10(10D)*.
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Liquidity: ULIPs offer some flexibility after a 5-year lock-in period. You can make partial withdrawals to address emergencies. However, it's recommended to avoid withdrawals unless absolutely necessary to achieve your long-term goals.
*The information on this website does not constitute tax advice. Tax benefits mentioned are subject to qualifications under Sections 80C, 10(10D), 115BAC, and other relevant provisions of the Income Tax Act, 1961. Goods and Services Tax (GST) and any applicable cess will be charged additionally at prevailing rates. Tax laws are subject to change. Please consult a qualified tax advisor for specific guidance on your situation.
Latest ULIP NAVs
| Fund Name | NAV  |
AUM |
5 Yr Returns |
10 Yr Returns | |
|---|---|---|---|---|---|
| SBI Life Balanced Fund | ₹72.21 | ₹19726 Cr | 5.85% | 8.7% | |
| SBI Life Bond Fund | ₹51.58 | ₹15328 Cr | 5.22% | 6.21% | |
| SBI Life Equity Fund | ₹192.63 | ₹81746 Cr | 7.6% | 10.53% | |
| SBI Life Equity Optimiser Fund | ₹54.04 | ₹2606 Cr | 7.49% | 10.3% | |
| SBI Life Growth Fund | ₹92.99 | ₹2837 Cr | 6.59% | 9.96% | |
| SBI Life Money Market Fund | ₹37.75 | ₹482 Cr | 6.04% | 5.89% | |
| SBI Life Top 300 Fund | ₹55.02 | ₹1972 Cr | 6.56% | 10.81% | |
| SBI Life Pure Fund | ₹28.15 | ₹1251 Cr | 7.07% | 9.95% | |
| SBI Life Bond Optimiser Fund | ₹22.68 | ₹3214 Cr | 6.28% | - | |
| SBI Life Bluechip Fund | ₹9.75 | ₹3671 Cr | - | - | |
| SBI Life Midcap Fund | ₹51.54 | ₹67697 Cr | 14.92% | 16.29% | |
| SBI Life Corporate Bond Fund | ₹16.76 | ₹1009 Cr | 5.16% | - | |
| SBI Life Balanced Pension | ₹72.66 | ₹867 Cr | 6.32% | 9.56% | |
| SBI Life Equity Optimiser Pension | ₹58.4 | ₹1105 Cr | 7.82% | 11.18% | |
| SBI Life Equity Elite II | ₹50.7 | ₹11844 Cr | 6.68% | 9.93% | |
| SBI Life Index | ₹45.13 | ₹87 Cr | 6.33% | 10.2% | |
| SBI Life Index Pension | ₹47.14 | ₹24 Cr | 6.4% | 10.26% | |
| SBI Life Top 300 Pension | ₹54.42 | ₹772 Cr | 6.86% | 11.09% | |
| SBI Life Discontinued Policy Fund | ₹26.01 | ₹10931 Cr | 5.61% | 5.85% | |
| SBI Life Bond Pension | ₹45.84 | ₹552 Cr | 5.16% | 6.46% | |
| SBI Life Equity Elite | ₹85.25 | ₹12 Cr | 8.64% | 12.66% | |
| SBI Life Equity Pension | ₹74.05 | ₹13758 Cr | 7.72% | 11.26% | |
| SBI Life Growth Pension | ₹73.58 | ₹692 Cr | 7.35% | 10.56% | |
| SBI Life Money Market Pension | ₹34.89 | ₹160 Cr | 5.99% | 5.87% | |
| SBI Life P-E Managed | ₹38.42 | ₹195 Cr | 7.23% | 8.87% | |
| SBI Life Guaranteed Pension GPF070211 | ₹27.01 | ₹1 Cr | 5% | 5.86% | |
| SBI Life Bond Pension II | ₹23.88 | ₹28119 Cr | 4.97% | 5.81% | |
| SBI Life Equity Pension II | ₹40.35 | ₹11378 Cr | 6.41% | 10.49% | |
| SBI Life Money Market Pension II | ₹21.29 | ₹1488 Cr | 5.75% | 5.62% | |
| SBI Life Discontinue Pension Fund | ₹21.97 | ₹6203 Cr | 5.63% | - | |
| SBI Life Group Growth Plus Fund | ₹57.16 | ₹3 Cr | 6.45% | - | |
| SBI Life Group Debt Plus Fund | ₹41.02 | ₹115 Cr | 5.79% | - | |
| SBI Life Group Balance Plus Fund | ₹48.59 | ₹11 Cr | 6.08% | - | |
| SBI Life Group Balance Plus Fund II | ₹27.55 | ₹1273 Cr | 6.78% | - | |
| SBI Life Group Debt Plus Fund II | ₹26.7 | ₹363 Cr | 5.87% | - | |
| SBI Life Group Growth Plus Fund II | ₹26.94 | ₹291 Cr | 6.85% | - | |
| SBI Life Group Short Term Plus Fund II | ₹22.03 | ₹24 Cr | 5.98% | - | |
| SBI Life Group Money Market Plus Fund | ₹14.17 | ₹2 Cr | 3.32% | - | |
| SBI Life Group Balanced Pension Fund | ₹10.26 | ₹194 Cr | - | - |
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Are ULIPs Right for You?
It depends on your individual financial situation and goals. If you are looking for an investment option that offers life insurance coverage, the potential for higher returns, and some flexibility, ULIPs could be a good fit. However, it's important to be aware of the risks involved and the associated charges. Before investing, carefully consider your risk tolerance, investment horizon, and financial goals. It's also wise to compare ULIPs with other investment options like mutual funds or ETFs to see which one best aligns with your needs.
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FAQs
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Are there any drawbacks to ULIPs?
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Market Risk: ULIPs are linked to the market, so your returns are not guaranteed. The value of your investment can fluctuate, and there is a possibility of loss.
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Investment Charges: ULIPs typically have higher charges compared to traditional insurance plans. These charges can include premium allocation charges, policy administration charges, and fund management charges. Understanding these fees is crucial.
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Lock-in Period: ULIPs typically have a lock-in period of 5-6 years. During this period, you cannot withdraw your money without facing surrender charges. This reduces liquidity compared to other options.
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What should I consider before buying a ULIP?
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Understand the Investment Options: Research the different fund options offered by the ULIP and their risk profiles.
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Compare Costs and Charges: Be aware of the premium allocation charges, policy administration charges, and fund management charges associated with the ULIP.
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Lock-in Period: Understand the lock-in period and any surrender charges that may apply if you withdraw your money before the term ends.
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Investment Horizon: ULIPs are suitable for long-term investments. Consider your investment horizon and if it aligns with the lock-in period.
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Is it advisable to consult a financial advisor before buying a ULIP?
Consulting a financial advisor can be beneficial. They can assess your financial situation, risk tolerance, and goals and recommend if a ULIP aligns with your needs. They can also help you compare different ULIP options and understand the associated risks and charges.
Insurers Offering ULIPs
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or
insurance product offered by an insurer.
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˜The insurers/plans mentioned are arranged in order of highest to lowest first year premium (sum of individual single premium and individual non-single premium) offered by Policybazaar’s insurer partners offering life insurance investment plans on our platform, as per ‘first year premium of life insurers as at 31.03.2025 report’ published by IRDAI. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the IRDAI website www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance
plan.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
+Returns Since Inception of LIC Growth Fund
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
++Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.