What is a single premium ULIP?

A single premium ULIP requires a one-time lump sum payment upfront, securing both insurance coverage and investment for the policy term.

What is a regular premium ULIP?

A regular premium ULIP involves periodic payments (monthly/quarterly/annually) to keep the policy active and benefit from long-term wealth creation.

Which offers better tax benefits?

Regular premium ULIPs allow annual tax deductions under Section 80C (up to â¹1.5 lakh per year). Single premium ULIPs offer a deduction only in the year of payment.

Which is more affordable?

Regular premiums are budget-friendly as costs are spread over time. Single premiums require a large upfront investment but may include discounts.

How does market risk differ?

Single premium ULIPs expose you to market timing risk. Regular premiums benefit from rupee cost averaging, reducing volatility impact.

Can I add riders later?

Regular premium ULIPs often allow adding riders (e.g., critical illness). Single premium plans usually lack this flexibility.

What happens if I miss a regular premium?

Missed payments may lead to a lapse or reduced benefits. Insurers often provide a grace period or revival options.

Which is better for long-term goals?

Both suit long-term goals, but regular premiums encourage disciplined investing. Single premiums work best for those with surplus funds.

Single Premium vs. Regular Premium ULIP Plans

Unit Linked Insurance Plans (ULIPs) are popular financial products that combine investment and life insurance. One of the key decisions when purchasing a ULIP is choosing between a single premium and a regular premium payment option. Both approaches have distinct features, benefits, and drawbacks that cater to different investor needs and financial situations.

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Zero LTCG Tax^¶
In built life cover

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What Are Single Premium ULIP Plans?

Single Premium ULIP Plans are a type of Unit Linked Insurance Plan where you pay the entire premium upfront as a lump sum at the start of the policy. This one-time payment covers both your life insurance and investment components for the entire policy term, eliminating the need for future premium payments.

In these plans, a portion of your lump sum premium goes towards life insurance coverage, while the rest is invested in market-linked funds such as equity, debt, or balanced funds, based on your risk appetite. The returns depend on the performance of these funds, offering the potential for wealth creation alongside insurance protection.

Single Premium ULIPs are ideal for investors with surplus funds who prefer a hassle-free, one-time payment without worrying about missing premiums or policy lapses. They also often come with discounts on ULIP charges due to the lump sum payment.

Investment Return Calculator (Power of Compounding)

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YOU INVEST

YOU GET

Top Funds with High Returns (Past 7 Years)

12.54%

Equity Fund

14.88%

Opportunities Fund

19.07%

High Growth Fund

13.4%

Opportunities Fund

21.09%

Multi Cap Fund

14.39%

Accelerator Mid-Cap Fund II

15.84%

Multiplier

14.73%

Frontline Equity Fund

18.41%

Pension Mid Cap Fund

11.46%

Growth Plus Fund

14.8%

US Equity Fund

15.06%

Grow Money Plus Fund

11.84%

Equity Top 250 Fund

14.24%

Future Apex Fund

12.17%

Pension Dynamic Equity Fund

14.53%

Accelerator Fund

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What are Regular Premium ULIP Plans?

Regular Premium ULIP (Unit Linked Insurance Plan) plans are financial products that combine life insurance with investment, and investors often ask which SIP is best for achieving long-term financial goals when comparing such structured, long-term investment options. In these plans, you pay a pre-fixed premium amount at regular intervals, such as monthly, quarterly, half-yearly, or annually, throughout the policy term. Each premium payment is split: a portion goes towards providing life insurance coverage, while the rest is invested in market-linked funds like equity, debt, or a mix, based on your risk appetite and financial goals.

Regular premium ULIPs are designed to promote disciplined, systematic investing, making them more affordable since the financial commitment is spread over time rather than requiring a large lump sum upfront. ULIP Tax benefits can be claimed every year under Section 80C for each premium paid. Additionally, regular contributions help average out market volatility, potentially reducing investment risk over the long term.

Fund Name

AUM

NAV

Returns (in %)

3 Year

5 Year

10 Year

Equity Fund

SBI

AUM:81,769 Cr

81,769 Cr

NAV

210.13

-1.08%

Returns

12.66%

Returns

14.4%

Highest Returns

Returns

12.54%

Get Details

Opportunities Fund

HDFC Standard

AUM:36,970 Cr

36,970 Cr

NAV

78.94

-0.21%

Returns

17.78%

Returns

20.53%

Highest Returns

Returns

14.88%

Get Details

High Growth Fund

Max Life

AUM:11,792 Cr

11,792 Cr

NAV

118.06

-0.42%

Returns

25.43%

Returns

26.3%

Highest Returns

Returns

19.07%

Get Details

Opportunities Fund

ICICI Prudential

AUM:3,553 Cr

3,553 Cr

NAV

62.33

-0.26%

Returns

15.64%

Returns

17.23%

Highest Returns

Returns

13.4%

Get Details

Multi Cap Fund

Tata AIA

AUM:9,302 Cr

9,302 Cr

NAV

65.44

-0.22%

Returns

18.88%

Returns

22.37%

Highest Returns

Returns

21.09%

Get Details

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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

Key Differences Between Single Premium and Regular Premium ULIP Plans

Feature	Single Premium ULIP	Regular Premium ULIP
Payment Mode	One-time lump sum	Periodic (monthly/quarterly/annual)
Affordability	Requires substantial upfront capital	More affordable, spread over time
Convenience	No worries about payment deadlines	Requires regular tracking and timely payment
Tax Benefits	Deduction only in the year of payment	Annual deductions for each premium paid
Risk	Higher, as investment timing is fixed	Lower, benefits from rupee cost averaging
Customization	Limited add-ons/riders	Can add riders and increase cover over time

Pros and Cons of Single Premium and Regular Premium ULIP Plans

Single Premium ULIP Plans:

Pros:
- Hassle-free, one-time payment—no risk of missing future premiums.
- No fear of policy lapse due to non-payment.
- Suitable for those with surplus funds or irregular income.
- Potential discounts for lump sum payment.
Cons:
- Large upfront outlay may not suit everyone.
- ULIP Tax benefit is limited to the year of payment.
- Less flexibility to add riders or increase cover later.
- Exposed to market volatility at the time of investment.
Regular Premium ULIP Plans

Pros:
- Spreads out the financial commitment, making it more affordable.
- Enables annual tax benefits under Section 80C for each year premiums are paid.
- Rupee cost averaging helps mitigate market volatility risk.
- Greater flexibility to add riders and enhance cover.
- In case of the policyholder’s demise before maturity, future premiums are not required, but benefits continue.
Cons:
- Requires discipline and regular income to avoid policy lapse.
- Missing payments can lead to discontinuation and lower returns.

Fund Name	NAV	AUM	5 Yr Returns	10 Yr Returns
SBI Life Balanced Fund	₹73.34	₹22084 Cr	8.63%	10.26%
SBI Life Bond Fund	₹50.23	₹17457 Cr	5.24%	6.88%
SBI Life Equity Fund	₹200.24	₹83975 Cr	11.74%	12.49%
SBI Life Equity Optimiser Fund	₹54.84	₹2728 Cr	11.92%	12.08%
SBI Life Growth Fund	₹94.27	₹3040 Cr	10.52%	11.78%
SBI Life Money Market Fund	₹36.35	₹434 Cr	5.68%	6.04%
SBI Life Top 300 Fund	₹57.07	₹2025 Cr	11.3%	12.87%
SBI Life Pure Fund	₹25.83	₹1192 Cr	10.13%	-
SBI Life Bond Optimiser Fund	₹22.32	₹3285 Cr	7.36%	-
SBI Life Bluechip Fund	₹9.97	₹3014 Cr	-	-
SBI Life Balanced Pension	₹73.51	₹807 Cr	9.18%	11.09%
SBI Life Bond Pension	₹44.56	₹526 Cr	5.11%	7.13%
SBI Life Equity Pension	₹74.8	₹11823 Cr	12.72%	13.24%
SBI Life Growth Pension	₹73.37	₹634 Cr	11.01%	12.24%
SBI Life Money Market Pension	₹33.6	₹138 Cr	5.63%	6.04%
SBI Life Equity Optimiser Pension	₹58.7	₹989 Cr	11.87%	12.87%
SBI Life Top 300 Pension	₹55.23	₹716 Cr	11.26%	12.9%
SBI Life Midcap Fund	₹47.42	₹52995 Cr	19.67%	-
SBI Life Corporate Bond Fund	₹16.3	₹1049 Cr	5.27%	-
SBI Life Equity Elite II	₹51.9	₹12638 Cr	10.86%	11.92%
SBI Life Index	₹48.57	₹112 Cr	12.28%	12.87%
SBI Life Index Pension	₹50.7	₹30 Cr	12.38%	12.9%
SBI Life Discontinued Policy Fund	₹25.23	₹9697 Cr	5.58%	6.09%
SBI Life Equity Elite	₹88.79	₹13 Cr	14%	14.87%
SBI Life P-E Managed	₹38.68	₹231 Cr	9.73%	10.53%
SBI Life Guaranteed Pension GPF070211	₹26.37	₹3 Cr	5.08%	6.83%
SBI Life Bond Pension II	₹23.3	₹29479 Cr	5.03%	6.51%
SBI Life Equity Pension II	₹42.38	₹12763 Cr	12.03%	12.98%
SBI Life Money Market Pension II	₹20.53	₹1549 Cr	5.38%	5.76%
SBI Life Discontinue Pension Fund	₹21.29	₹6566 Cr	5.56%	-
SBI Life Group Growth Plus Fund	₹57.21	₹3 Cr	8.93%	-
SBI Life Group Debt Plus Fund	₹40.17	₹113 Cr	6.34%	-
SBI Life Group Balance Plus Fund	₹48.23	₹11 Cr	7.49%	-
SBI Life Group Balance Plus Fund II	₹26.43	₹809 Cr	7.46%	-
SBI Life Group Debt Plus Fund II	₹26.02	₹232 Cr	6.33%	-
SBI Life Group Growth Plus Fund II	₹26.73	₹240 Cr	9.02%	-
SBI Life Group Short Term Plus Fund II	₹21.38	₹21 Cr	5.9%	-
SBI Life Group Money Market Plus Fund	₹12.44	₹2 Cr	1.03%	-

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Which ULIP Premium Option Should You Choose?

The choice between single and regular premium ULIP plans depends on your financial situation, investment style, and insurance needs:

Opt for Single Premium ULIP if:
- You have a lump sum available for investment.
- You prefer a hassle-free, one-time transaction.
- You want to avoid the risk of missing payments or lapsing the policy.
Opt for Regular Premium ULIP if:
- You prefer spreading out your payments.
- You want to maximize annual tax benefits.
- You value flexibility and the ability to add riders over time.
- You wish to benefit from rupee cost averaging in volatile markets.

Additional Considerations

ULIP Charges

Both single and regular premium ULIPs have various charges such as fund management, mortality, and premium allocation charges. Understanding these [ULIP charges] is crucial to evaluating the overall cost and potential returns of your ULIP investment.
ULIP Calculator

Use to compare plans, estimate returns, and understand the impact of charges and premium payment modes on your investment outcome.

Conclusion

Both single and regular premium ULIP plans offer the dual advantage of investment and insurance. Your decision should be based on your cash flow, risk appetite, tax planning needs, and convenience preferences. Assess your financial goals carefully to choose the ULIP premium payment mode that aligns best with your long-term objectives.

FAQs

What is a single premium ULIP?

A single premium ULIP requires a one-time lump sum payment upfront, securing both insurance coverage and investment for the policy term.
What is a regular premium ULIP?

A regular premium ULIP involves periodic payments (monthly/quarterly/annually) to keep the policy active and benefit from long-term wealth creation.
Which offers better tax benefits?

Regular premium ULIPs allow annual tax deductions under Section 80C (up to ₹1.5 lakh per year). Single premium ULIPs offer a deduction only in the year of payment.
Which is more affordable?

Regular premiums are budget-friendly as costs are spread over time. Single premiums require a large upfront investment but may include discounts.
How does market risk differ?

Single premium ULIPs expose you to market timing risk. Regular premiums benefit from rupee cost averaging, reducing volatility impact.
Can I add riders later?

Regular premium ULIPs often allow adding riders (e.g., critical illness). Single premium plans usually lack this flexibility.
What happens if I miss a regular premium?

Missed payments may lead to a lapse or reduced benefits. Insurers often provide a grace period or revival options.
Which is better for long-term goals?

Both suit long-term goals, but regular premiums encourage disciplined investing. Single premiums work best for those with surplus funds.

˜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.