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Unit Linked Health Plan
A Unit Linked Health Plan(ULHP) is a double-benefit plan which provides the investor with a safety net by covering their medical expenses along with a flexible market-based wealth creation opportunity.
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- Unit Linked Health Plan
List of ULIP Funds ~
Fund Name
AUM
NAV
Returns (in %)
3 Year
5 Year
10 Year
Midcap Fund
SBI Life
AUM:57,040 Cr
57,040 Cr
NAV
50.43
-50.43%
Returns
19.16%
Highest Returns
Opportunities Fund
HDFC Life
AUM:35,377 Cr
35,377 Cr
NAV
79.15
0.52%
Returns
15.53%
Highest Returns
High Growth Pension Fund
Axis Max Life
AUM:4 Cr
4 Cr
NAV
10.38
0.01%
Returns
22.85%
Highest Returns
US Technology Advantage Fund
ICICI Prudential Life
AUM:0 Cr
0 Cr
NAV
0.00%
Returns
-
Multi Cap Fund
Tata AIA Life
AUM:10,579 Cr
10,579 Cr
NAV
66.28
-66.28%
Returns
16.42%
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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 is a Unit Linked Health Plan?
Unit Linked Health Plan is a unique financial product that works by dividing the policyholder's premium into two parts: one part for insurance coverage and the other part for investment. It provides the policyholder with the benefits of health coverage along with long-term wealth creation potential.
The part of the premium that is put towards insurance provides coverage in times of hospitalisation, daycare, surgery, outpatient expenses and critical illness coverage. The remaining part of the premium is diverted towards investments. A ULHP allows investors to invest in various funds as per their goals and risk appetite.
The policyholder can also choose to switch between funds at any time. This allows them to adjust their investment strategy depending on their changing risk appetite and investment goals.
What are the Features and Benefits of a Unit Linked Health Plan?
Some common features of a Unit Linked Health Plan are:
- Health Coverage: ULHP provides its customers with comprehensive health coverage. It can include services like hospitalisation, daycare surgery, outpatient expenses and coverage during critical illness.
- Market-based growth: It also offers the investor the potential to grow their investments by investing in various funds while also allowing them to switch between funds at any time.
- Tax benefits: It offers tax benefits on premiums paid and returns received on them.
- Partial Withdrawal: Several ULHPs let policyholders make partial withdrawals from their investment account after the lock-in period is complete.
- Top-up: ULHPs also allow policyholders ot increase the amount of their investment at any point during the policy term.
- Riders: ULHPs might also provide various riders such as accidental death benefits, waiver of premiums and hospital cash allowance.
- Long-term financial security: ULHP can also help you achieve your long-term goals. It can help you to start early retirement planning or child education goals.
How Does a Unit-Linked Health Plan Work?
A ULHP plan does not invest your entire premium into a single bucket. It divides the premium and allocates it into two distinct buckets. Let's look at how a ULHP works.
Step 1: Premium is Split
The premium paid by you is split and put into two buckets: Insurance to provide you with health cover. The remaining sum is put into the market.
Step 2: Health Coverage
The portion of your premium allocated for insurance purposes provides you with a safety net against medical expenses. This portion of your premium functions exactly like a health insurance policy.
Step 3: Wealth Creation
The remaining money is directly invested into capital markets. You can choose a fund of your choice as per your financial goals and risk appetite. You can put your money into equity-based funds if your risk appetite allows you to do so; similarly, if you wish to play safe, you can invest in debt funds or create a hybrid portfolio to reap the benefits of both.
Step 4: Fund Switching
The Plan also lets you switch between various funds depending on your need of the hour, market fluctuations, financial goals, and risk appetite.
Step 5: Returns
The double benefit offered by this plan can lead you to two outcomes. In case of any medical emergency during the policy term, the insurance portion of the plan will pay for the covered medical expenses. Additionally, when the policy matures, you receive the accumulated value of your funds.
Who Should Invest in a Unit-Linked Health Plan?
Here are some people who may want to consider investing in a ULHP:
- Individuals seeking comprehensive health coverage: Since ULHPs provide for a long list of covered medical expenses, individuals who are seeking health coverage which can cover most of their medical emergencies can invest in a ULHP.
- People with a long-term investment window: People who can sustain long-term investments and wish for long-term wealth creation can consider investing in ULHPs.
- People with a comfortable risk appetite: Individuals who can tolerate investing despite market fluctuations and can digest risk to grow long-term can consider investing in ULHPs.
- Individuals looking for flexible products: ULHPs allow investors to choose from various fund options and provide the option to switch between the funds throughout the policy term. This allows for flexibility for the investors who can redirect their funds as per their goals.
How to Choose the Best Unit Linked Health Plan in India?~
When choosing the best unit-linked health plan (ULHP) in India, there are a few factors you should consider:
- Health coverage and investment needs: What are your health insurance needs? How much coverage do you need? What is your risk appetite? What are your investment goals? You should choose a ULHP that meets your specific needs and requirements.
- The insurance company: Choose a unit-linked health plan from a reputable and financially sound insurance company. You can check the insurance company's financial ratings and customer reviews online.
Latest ULIP NAVs
| Fund Name | NAV  |
AUM |
5 Yr Returns |
10 Yr Returns | |
|---|---|---|---|---|---|
| SBI Life Balanced Fund | ₹72.73 | ₹20171 Cr | 7.4% | 9.43% | |
| SBI Life Bond Fund | ₹51.76 | ₹16641 Cr | 5.76% | 6.73% | |
| SBI Life Equity Fund | ₹193.58 | ₹77698 Cr | 9% | 11.21% | |
| SBI Life Equity Optimiser Fund | ₹53.96 | ₹2513 Cr | 9.78% | 11.07% | |
| SBI Life Growth Fund | ₹93.36 | ₹2808 Cr | 8.4% | 10.75% | |
| SBI Life Money Market Fund | ₹37.25 | ₹487 Cr | 5.91% | 5.95% | |
| SBI Life Top 300 Fund | ₹55.33 | ₹1918 Cr | 8.74% | 11.59% | |
| SBI Life Pure Fund | ₹27.52 | ₹1179 Cr | 8.85% | 10.58% | |
| SBI Life Bond Optimiser Fund | ₹22.8 | ₹3231 Cr | 7.28% | - | |
| SBI Life Bluechip Fund | ₹9.8 | ₹3250 Cr | - | - | |
| SBI Life Balanced Pension | ₹73.17 | ₹805 Cr | 8.12% | 10.3% | |
| SBI Life Bond Pension | ₹46 | ₹544 Cr | 5.61% | 7.01% | |
| SBI Life Equity Pension | ₹73.96 | ₹11974 Cr | 10.12% | 12.18% | |
| SBI Life Growth Pension | ₹73.16 | ₹631 Cr | 9.01% | 11.23% | |
| SBI Life Money Market Pension | ₹34.44 | ₹149 Cr | 5.86% | 5.93% | |
| SBI Life Equity Optimiser Pension | ₹57.22 | ₹975 Cr | 9.64% | 11.75% | |
| SBI Life Top 300 Pension | ₹54.69 | ₹712 Cr | 9.1% | 11.86% | |
| SBI Life Midcap Fund | ₹50.43 | ₹57040 Cr | 16.91% | 17.31% | |
| SBI Life Corporate Bond Fund | ₹16.74 | ₹1041 Cr | 5.57% | - | |
| SBI Life Equity Elite II | ₹50.77 | ₹11737 Cr | 8.44% | 10.28% | |
| SBI Life Index | ₹45.8 | ₹90 Cr | 8.67% | 10.63% | |
| SBI Life Index Pension | ₹47.82 | ₹25 Cr | 8.79% | 10.68% | |
| SBI Life Discontinued Policy Fund | ₹25.89 | ₹10629 Cr | 5.7% | 5.93% | |
| SBI Life Equity Elite | ₹85.65 | ₹12 Cr | 10.82% | 13.02% | |
| SBI Life P-E Managed | ₹38.43 | ₹200 Cr | 8.29% | 9.15% | |
| SBI Life Guaranteed Pension GPF070211 | ₹26.98 | ₹2 Cr | 5.17% | 6.21% | |
| SBI Life Bond Pension II | ₹23.89 | ₹28936 Cr | 5.36% | 6.1% | |
| SBI Life Equity Pension II | ₹40.51 | ₹11368 Cr | 8.56% | 10.97% | |
| SBI Life Money Market Pension II | ₹21.1 | ₹1509 Cr | 5.66% | 5.66% | |
| SBI Life Discontinue Pension Fund | ₹21.85 | ₹6455 Cr | 5.71% | - | |
| SBI Life Group Growth Plus Fund | ₹57.18 | ₹3 Cr | 7.67% | - | |
| SBI Life Group Debt Plus Fund | ₹41.01 | ₹114 Cr | 6.3% | - | |
| SBI Life Group Balance Plus Fund | ₹48.7 | ₹11 Cr | 6.97% | - | |
| SBI Life Group Balance Plus Fund II | ₹26.81 | ₹1208 Cr | 7.02% | - | |
| SBI Life Group Debt Plus Fund II | ₹26.66 | ₹337 Cr | 6.39% | - | |
| SBI Life Group Growth Plus Fund II | ₹26.94 | ₹295 Cr | 8.04% | - | |
| SBI Life Group Short Term Plus Fund II | ₹22.04 | ₹19 Cr | 6.15% | - | |
| SBI Life Group Money Market Plus Fund | ₹14.07 | ₹2 Cr | 3.27% | - | |
| SBI Life Group Balanced Pension Fund | ₹10.18 | ₹128 Cr | - | - |
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- The plan features: Compare the features of different ULHPs before choosing one. Consider factors such as the sum assured, coverage options, investment options, charges, and lock-in period.
- The premium: ULHPs can be more expensive than traditional health insurance plans. However, it is important to choose a ULHP that you can afford to pay the premiums for.
Unit Linked Health Plan Charges
The following table lists all the charges that accompany a Unit Linked Health Plan.
| Charges | Definition |
| Premium Allocation charges | This is the initial charge that an insurer deducts upfront from your premium to cover costs such as underwriting costs, distributor commissions and medical evaluations. The remaining premium gets invested into the policy. |
| Fund Management Charges | This is the charge a company takes from the customer to manage their portfolio while tracking the market. |
| Morbidity Charges | The insurer provides its customer with a safety net through these charges, which are deducted by estimating an individual's hospitalisation needs during a year. This cost is deducted from your fund value. |
| Policy Administration charges | This charge is deducted to keep the policy active on the insurer's servers. |
Risks to Consider Before Investing in a Unit Linked Health Plan
- Market dependence and volatility: A significant portion of the ULHP is diverted towards market-based investments. These are directly affected by market volatility. Thus, ULHPs offer no guaranteed returns to the investor.
- Risk of inadequate coverage: Since a part of the premiums paid is directed towards investment, the accumulated corpus depends on market performance and guarantees no fixed returns. In times of market dips, the returns might not be able to provide appropriate health coverage to an individual who could have had a guaranteed set of returns with regular health insurance.
- High charges: A lot of charges are included with ULHPs, like morbidity charges, premium allocation charges, fund management charges and policy administration charges. These charges reduce the overall premium, which earns returns on the sum.
- Liquidity and financial commitments: The plan generally needs a lock-in period of 5 years. Additionally, these plans are designed as long-term financial commitments, and if exited early, can lead to returns not justifying the high premiums.
What is the Difference Between ULHP, ULIP and Health Insurance?
The following table lists the difference between ULHP, ULIP and Health Insurance.
| Parameter | ULHP | ULIP | Health Insurance |
| Focus | Health Insurance+Wealth creation | Life coverage + wealth creation | Medical protection |
| Lock-in period | 5 years | 5 years | Generally none |
| Maturity value | Depends on market performance | Depends on market performance | None |
| Investment Risk | Market fluctuations can reduce the final maturity value. Borne by the investor | Market fluctuations can reduce the final maturity value. Borne by the investor | None |
| Core Benefit | Pays medical bills and provides for market-based wealth creation. | Provides life cover along with market-based wealth creation | Pays medical expenses. |
FAQs
-
Are ULHPs eligible for tax benefits?
Yes, ULHP offer several tax benefits in India. Including tax deductions of upto 1.5 lakh under section 80C of the income tax act. -
Can I surrender my ULHP before maturity?
Yes, you have the option to surrender your ULHP before maturity. Note that different insurers can charge you differently on the same, as per their policy terms. -
How can i decide on the best ULHP?
You can choose the best ULHP for yourself by assessing yourself on your healthcare needs, medical expenses, and any predictable medical emergency, along with your long-term financial goals and risk tolerance. -
Are there any exclusions under ULHP?
Yes, there are various exclusions under ULHP. Any procedure which might be considered medically unnecessary is excluded from ULHP coverage. Cosmetic procedures and self-inflicted injuries are also excluded.
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.