How To Get Better Returns with ULIP Investment Plans?

ULIP or a Unit Linked Investment Plan is one of the most popular life insurance products for wealth creation. The plan offers dual benefits of investment and insurance along with tax benefits. However, multiple factors need to be considered to get maximized returns on your ULIP Investment.

Read more
Best ULIP Plans
  • Guaranteed Tax Savings

    Guaranteed Tax Savings^

    Under sec 80C & 10(10D)
  • savings

    ₹1 Crore

    Invest ₹10k Per Month*
  • Zero LTCG Tax

    Zero LTCG Tax^

    Unlike 10% in Mutual Funds
We are rated~
rating
6.7 Crore
Registered Consumers
51
Insurance Partners
3.4 Crore
Policies Sold

Top performing plans with High Returns*

Invest ₹10K/month & Get ₹1 Crore returns*

+91
Secure
We don’t spam
Please wait. We Are Processing..
Your personal information is secure with us
Plans available only for people of Indian origin By clicking on "View Plans" you agree to our Privacy Policy and Terms of use #For a 55 year on investment of 20Lacs #Discount offered by insurance company
Get Updates on WhatsApp
We are rated~
rating
6.7 Crore
Registered Consumers
51
Insurance Partners
3.4 Crore
Policies Sold

Top ULIP Funds
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
1,663 Cr
Returns
26.56%
Highest Returns
Returns
26.54%
Returns
20.86%
Get Details
2,894 Cr
Returns
24.33%
Highest Returns
Returns
22.69%
Returns
18.63%
Get Details
2,337 Cr
Returns
22.64%
Highest Returns
Returns
18.83%
Returns
17.7%
Get Details
961 Cr
Returns
19.93%
Highest Returns
Returns
18.63%
Returns
17.36%
Get Details
6,464 Cr
Returns
19.11%
Highest Returns
Returns
17.33%
Returns
17.09%
Get Details
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
11,380 Cr
Returns
24.19%
Highest Returns
Returns
22.82%
Returns
21.83%
Get Details
1,340 Cr
Returns
30.25%
Highest Returns
Returns
22.36%
Returns
19.93%
Get Details
5,651 Cr
Returns
29.46%
Highest Returns
Returns
26.41%
Returns
19.59%
Get Details
4,058 Cr
Returns
25.25%
Highest Returns
Returns
18.66%
Returns
19.31%
Get Details
5,938 Cr
Returns
24.34%
Highest Returns
Returns
18.17%
Returns
18.75%
Get Details
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
241 Cr
Returns
13.46%
Returns
14.3%
Highest Returns
Returns
12.93%
Get Details
344 Cr
Returns
12.94%
Highest Returns
Returns
12.38%
Returns
12.22%
Get Details
836 Cr
Returns
13.15%
Highest Returns
Returns
11.85%
Returns
11.11%
Get Details
523 Cr
Returns
10.47%
Returns
10.66%
Returns
11.09%
Highest Returns
Get Details
21 Cr
Returns
13.34%
Highest Returns
Returns
11.76%
Returns
10.93%
Get Details
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
487 Cr
Returns
18.5%
Highest Returns
Returns
16.5%
Returns
16.15%
Get Details
243 Cr
Returns
7.13%
Returns
8.11%
Returns
9.26%
Highest Returns
Get Details
777 Cr
Returns
5.24%
Returns
7.25%
Returns
8.38%
Highest Returns
Get Details
466 Cr
Returns
5.02%
Returns
7.44%
Returns
8.17%
Highest Returns
Get Details
305 Cr
Returns
5.88%
Returns
7.03%
Returns
8.16%
Highest Returns
Get Details

In this article, we will discuss simple strategies that can help you accumulate wealth through ULIP investments.

Tips To Maximize ULIP Returns

To make the most out of your ULIP Investments, all types of investors can follow some easy strategies either by themselves or with the help of a professional. These are:

  1. Stay invested and benefit from compounding

    ULIPs have a lock-in period of five years making them suitable to achieve long term investment plans. By staying invested for 10 to 15 years, the power of compounding can be utilized to create a huge corpus.

  2. Analyze risk appetite for equity and debt investment

    Equity and debt funds have different characteristics. While equity schemes are considered high-return and high-risk, debt funds are the opposite. ULIP investments give you the option to choose funds based on your risk appetite.

    Hybrid funds create a balance between equity and debt. ULIP investments have only 40% equity exposure, making them a comparatively safer investment option.

  3. Pay premiums on time

    ULIPs have a compulsory lock-in period during which you cannot surrender the policy or delay premium payments. If it happens, the investment is moved to a discontinued fund.

    The discontinuance fund does not generate any returns. The IRDAI (Insurance Regulatory and Development Authority) also charges "discontinuance fees" for the same. To receive the best returns on ULIP investments, it is crucial to keep up with premiums payments.

  4. Avoid partial withdrawals

    ULIPs offer policyholders the opportunity to withdraw a portion of their funds. To be eligible for partial withdrawals, you must remain invested until the ULIP lock-in period (5 years) is over. 

    If you make partial withdrawals before the end of lock-in, you may not receive the full maturity payout. Additionally, you will miss out on potential investment growth over time through compounding.

  5. Optimized asset allocation

    Unit Linked Investment Plans (ULIPs) offer free switches between funds to manage portfolio asset allocation effectively. It is best to spread investments across different asset classes to get maximum returns and reduce exposure to market risks. Optimizing asset allocation can also help determine the risk-to-return ratio of your current portfolio.

    Let's understand this with an example.

    Mr. Sharma, a 32-year-old professional, has invested in a ULIP plan for 30-years. He maintains 100% of his ULIP investment in equity schemes. Let’s say after 5 to 7 years, as Mr. Sharma has children and increased financial responsibilities, he wants to reduce his equity exposure.

    By switching between equity and debt fund, he can optimize his portfolio to get maximum returns. While equity will help him aggressively grow investments, debt will help keep the market risks in check.

    Invest more and Get more with ULIP Plan Invest more and Get more with ULIP Plan
  6. Align investment with long-term goals

    The primary motive to start investment is wealth creation and saving for future investments like education, housing, marriage, and retirement. Financial goals are crucial in defining one's risk appetite for long term investment.

    For instance, investing in ULIP child education plans can demand frequent fund switches to build a corpus in the initial years. It is an effective way to align investment with future goals.

  7. Invest with a disciplined approach

    The lock-in period of ULIP plans encourages the habit of saving and helps generate compounding returns on long-term investments. Some insurance companies also offer additional loyalty benefits to investors.

    Loyalty benefits involve paying back all charges that were levied at the time of activation. Charges included are policy administration charges, fund management charges, surrender charges, and mortality charges.

  8. Portfolio Rebalancing

    It is essential to regularly review and monitor your investment plan to keep gains and losses in check. The performance of financial markets can be unpredictable. Regular review and rebalancing of funds can help you align ULIP investments with your future financial goals.

Benefits of Investing in Unit Linked Insurance Plans

ULIPs have gained popularity in recent years due to their potential to provide higher returns and offer tax benefits. Here are some of the benefits of investing in Unit Linked Insurance Plans:

  • Dual benefit of insurance and investment: ULIPs provide the dual benefit of insurance and investment. The insurance component of the plan provides financial protection to the policyholder and their family in case of an untoward event like death or disability. The investment component of the plan provides an opportunity to generate wealth over the long term.

  • Flexibility and customization: ULIPs offer flexibility and customization to the policyholders. Policyholders can choose from various funds to invest in depending on their risk appetite and investment objectives. They can also switch between funds based on market conditions and their investment goals.

  • Potential for higher returns: ULIPs have the potential to offer higher returns compared to traditional investment products like fixed deposits or traditional life insurance plans. Since ULIPs invest in equity and debt markets, they provide an opportunity to earn higher returns over the long term.

  • Tax benefits: ULIPs offer tax benefits under Section 80C of the Income Tax Act. Policyholders can claim a tax deduction of up to Rs 1.5 lakh on their premium payments. Additionally, the maturity amount and death benefit received from the plan are tax-free under Section 10(10D) of the Income Tax Act.

  • Goal-based investing: ULIPs allow policyholders to invest based on their specific financial goals like retirement planning, child’s education, or buying a house. This helps in achieving the desired financial goals within a specific time frame.

    Invest in high growth ULIP Plans Invest in high growth ULIP Plans
  • Cost-effective: ULIPs have become more cost-effective in recent years due to regulatory changes. The charges on ULIPs are now capped, and policyholders can easily compare them across different plans. This ensures that the policyholder gets the maximum returns from their investment.

In Conclusion

ULIPs make a perfect investment choice when it comes to maximizing returns with market exposure and also keeping up the protection portion with life insurance cover. It encompasses financial protection for your family along with the option to grow your funds. Not only that ULIPs are versatile in terms of being an investment as well as an insurance plan, but it also helps you in saving tax with controlled market risk.

*All savings are provided by the insurer as per the IRDAI approved insurance plan.
*Tax benefit is subject to changes in tax laws. Standard T&C Apply
^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
~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.

Grow your wealth & meet your Financial goals

Systematically Invest in high growth plans with returns upto 18%*
View plans
Standard T & C Apply*
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
Invest More Get More!
You Get
₹1 Crores*
You Invest
₹10K/month
You Get
₹80 Lakhs*
You Invest
₹8K/month
You Get
₹50 Lakhs*
You Invest
₹5K/month
capital guarantee
Investment Calculator
  • One time
  • Monthly
/ Year
Sensex has given 10% return from 2010 - 2020
You invest
You get
View plans

Ulip plans articles

Recent Articles
Popular Articles
ULIP Plan Riders

17 Jan 2024

ULIP or Unit Linked Insurance Plans provide rider benefits. They
Read more
ULIP Returns in 40 Years

08 Jan 2024

Estimating the ULIP returns over 40 years offers a unique
Read more
ULIP Returns in 35 Years

04 Jan 2024

A 35-year ULIP (Unit Linked Insurance Plan) emerges as an
Read more
ULIP Returns in 30 Years

03 Jan 2024

A 30-year ULIP (Unit Linked Insurance Plan) is a type of
Read more
ULIP Returns in 25 Years

03 Jan 2024

A 25-year ULIP (Unit Linked Insurance Plan) emerges as an
Read more
ULIP Calculator
A ULIP Calculator is a financial tool designed to help you compare ULIP plans and estimate the maturity amount
Read more
SBI Life Smart Privilege Plan: Benefits & Features
SBI Life Smart Privilege is a unit-linked, non-participating life insurance plan offered by SBI Life Insurance
Read more
7 Things to Know About the Tax Benefits of ULIPs
Nowadays, Unit Linked Insurance Plans, i.e., ULIPs, have evolved as the popular income tax saving investment
Read more
ULIP Returns in 5 Years
ULIP means Unit Linked Insurance Plan. It is a unique financial instrument that combines insurance coverage with
Read more
Tata AIA ULIP Plan Calculator
A Tata AIA ULIP Plan Calculator is a premium and returns calculation tool that helps easily and quickly compare
Read more

top

Become a Crorepati

Invest ₹10K/Month & Get ₹1 Crore returns*

Mobile +91
*T&C Applied.
Close
Download the Policybazaar app
to manage all your insurance needs.
INSTALL