ULIP Returns in 20 Years

Unit Linked Insurance Plans (ULIPs) have emerged as a popular investment choice among smart individuals seeking long-term wealth accumulation. ULIPs offer the dual advantage of life insurance coverage and the potential for market-linked returns, making them an attractive option for those seeking a diversified investment portfolio.

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Top ULIP Funds

ULIP Plans Fund Size  NAV Returns
TATA AIA Top 200 Fund 1,259 Cr ₹130.92 20.25%
TATA AIA Whole Life Mid Cap Equity Fund 10,158 Cr ₹112.98 21.46%
ICICI Pru Multi Cap Balanced Fund 2,037 Cr ₹34.46 10.59%
HDFC Life Opportunities Fund 31,393 Cr ₹57.85 18.59%

What is the 20 Years ULIP Policy?

A 20-year ULIP policy is a financial product that combines life insurance with investment opportunities. This policy provides life coverage for a duration of 20 years, ensuring financial protection for the policyholder's family. In the unfortunate event of the policyholder's demise within this period, the family receives a lump sum payout.

What sets the 20-year ULIP apart is its dual nature. Not only does it offer life coverage, but it also allows the policyholder to invest in different funds like equity, debt, or balanced funds. The premium paid towards the policy is split between these two components – life cover and investment. This unique feature provides investors with a dual benefit, addressing both protection and wealth creation.

Top ULIP Funds
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
11,839 Cr
Returns
21.83%
Returns
23.81%
Highest Returns
Returns
19.95%
Get Details
1,772 Cr
Returns
23.15%
Returns
27.3%
Highest Returns
Returns
19.47%
Get Details
6,136 Cr
Returns
26.84%
Returns
27.87%
Highest Returns
Returns
18.81%
Get Details
2,984 Cr
Returns
21.78%
Returns
23.76%
Highest Returns
Returns
17.76%
Get Details
4,172 Cr
Returns
21.74%
Highest Returns
Returns
20%
Returns
17.43%
Get Details
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
247 Cr
Returns
11.88%
Returns
13.92%
Highest Returns
Returns
11.99%
Get Details
352 Cr
Returns
12.26%
Returns
12.56%
Highest Returns
Returns
11.38%
Get Details
526 Cr
Returns
9.79%
Returns
10.72%
Highest Returns
Returns
10.34%
Get Details
837 Cr
Returns
11.67%
Returns
11.81%
Highest Returns
Returns
10.23%
Get Details
22 Cr
Returns
12.6%
Highest Returns
Returns
11.89%
Returns
10.17%
Get Details
Fund Name
AUM
Returns (in %)
3 Year
5 Year
10 Year
494 Cr
Returns
16.43%
Returns
17.28%
Highest Returns
Returns
15.3%
Get Details
242 Cr
Returns
6.94%
Returns
7.91%
Returns
8.81%
Highest Returns
Get Details
786 Cr
Returns
5.4%
Returns
6.88%
Returns
8.1%
Highest Returns
Get Details
302 Cr
Returns
5.86%
Returns
6.8%
Returns
7.79%
Highest Returns
Get Details
465 Cr
Returns
5.1%
Returns
6.93%
Returns
7.78%
Highest Returns
Get Details

How Does 20 Years ULIP Policy Work?

  • Shivam, a 30-year-old IT professional, decides to invest in a 20-year ULIP policy to secure his family's financial future.

  • He opts for a monthly premium of Rs. 5,000.

  • Shivam allocates 70% of his premium towards equity funds and 30% towards debt funds, reflecting his moderate risk appetite.

  • Over the 20 years, the equity funds perform well, while the debt funds provide stability.

Maturity Outcome:

  • At the end of the 20-year policy term, Shivam’s accumulated investment value has grown to Rs. 20 lakhs.

  • He chooses to receive the maturity benefit as a lump sum, providing him with a substantial financial cushion.

  • Shivam’s family is also protected by life insurance coverage throughout the 20-year policy term.

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Why Should You Choose a 20-Year ULIP Policy?

If you're considering a long-term investment, a 20-year ULIP can be a strategic choice. Here's why:

  • Market-Linked Returns: ULIPs offer the advantage of market-linked equity and debt funds, potentially yielding higher returns compared to traditional low-risk savings.

  • Flexibility: Investors can choose and switch investment funds based on market trends, maximizing returns by responding to market fluctuations.

  • Partial Withdrawals: In financial emergencies, ULIPs allow policyholders to make partial withdrawals, providing liquidity for significant expenses like education or marriage without exiting the plan.

  • Tax Benefits: Enjoy tax deductions under Section 80C for the amount invested. Additionally, ULIP proceeds on surrender, partial withdrawal, or maturity are tax-exempt under Section 10(10D), with certain conditions.

  • Life Coverage: ULIPs provide life coverage, ensuring financial security for your loved ones in case of unforeseen events.

  • Long-Term Investment: Staying invested for 20 years allows for the compounding effect, potentially resulting in superior returns compared to shorter-term investments.

How are Return Rates Calculated on 20 Years ULIP Policy?

The return rates of a 20-year ULIP policy are determined by various factors, including the policyholder's age, sum assured, chosen premium amount, and selected investment funds. The premium is divided between life cover and investments, with returns depending on the performance of market-linked funds. This policy serves as a tool for long-term wealth accumulation and life coverage. Before choosing a plan, it's crucial to assess risk appetite and goals. Regularly review plan terms and consider enhancing coverage with riders for added protection.

FAQ's

  • Is it a good time to buy a ULIP?

    Whether or not it is a good time to buy a ULIP depends on your individual circumstances and risk tolerance. ULIPs are a good investment option for those who have a long-term investment horizon and are comfortable with some risk. However, if you are not comfortable with risk, or if you need your money in the short term, then a ULIP may not be the best option for you.
  • Is ULIP better than FD?

    ULIPs and fixed deposits (FDs) are two different types of investments with different risk and return profiles. FDs are a low-risk investment that offers a guaranteed return, while ULIPs are a higher-risk investment that offers the potential for higher returns. The best option for you will depend on your individual circumstances and risk tolerance.
  • Which is better, SIP or ULIP?

    SIPs and ULIPs are both investment options that allow you to invest regularly and achieve long-term financial goals. SIPs are a good option for those who want to invest a fixed amount of money on a regular basis, while ULIPs offer more flexibility in terms of investment options and fund allocation. The best option for you will depend on your individual circumstances and investment goals.
  • Which is better MF or ULIP?

    Mutual funds (MFs) and ULIPs are both investment options that offer the potential for market-linked returns. However, MFs are generally considered to be more transparent and less expensive than ULIPs. ULIPs, on the other hand, offer the added benefit of life insurance coverage. The best option for you will depend on your individual circumstances and risk tolerance.

*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.

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Insurers Offering ULIPs

Tata AIA

Aditya Birla Sun Life

Bajaj Allianz

Max Life

HDFC Life

ICICI Prudential

Bharti AXA Life

Edelweiss Life

Kotak Life

Future Generali

PNB MetLife

SBI Life

Aviva

Bandhan Life

Canara HSBC

IDBI Federal

IndiaFirst

Pramerica Life

Reliance Life

Sahara Life

Shriram Life

Star Union

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