7 Parameters You Must Consider to Select the Best ULIP For Your Portfolio
A Unit Linked Insurance Plan or a ULIP plan can provide your family with financial protection even after your demise. ULIPs combine market-linked returns with life cover and thus offer the policyholder a world of benefits. These are a very useful investment tool for anyone looking for a way to secure their family’s financial future. However, while choosing a ULIP policy, the policyholder must do thorough research about the options available in the Indian market to ensure that their investment is fruitful.
How to Select the Best ULIP Plan?
To opt for a ULIP policy, the policyholder must pay a pre-decided sum as premiums regularly like any other insurance plan. A part of the premium is used to offer life cover, and the rest of the amount is invested in the share market for better returns in the future.
Also, while choosing a ULIP plan for your family, you can select the amount of coverage that you will need so that your family can be protected even if something happens to you. Moreover, a ULIP policy will also allow you to earn from the share market investments.
So, during a ULIP investment, keep the below-listed questions in mind:
- How Much Risk Can You Handle?
This is the most vital aspect to look at while selecting a ULIP insurance plan. If you start at an early age, your capacity to handle risks would be higher. However, if you have more dependents, you’ll have a decreased capacity of handling any financial risks. Therefore, your risk-taking capacity will help you choose just the right ULIP plan for yourself and your family. The Indian insurance providers have a host of different ULIP options. So, before investing in any of them, do ensure if they have the fund-switching option or not. This will help you in future.
- What Are Your Investment Objectives?
Why do you need a ULIP plan? For example, do you wish to invest in your future home, or do you think you will need money for your child’s admission to a good college? If you can identify your investment objective better, it will help you to choose just the right kind of ULIP policy for yourself. Simply put, checking your future investment goals will help you choose the right plan.
- What Are The Available Coverage Options?
While choosing a ULIP insurance policy, always try to find out the death benefits it can offer your family. Then, if you choose a good policy, like the Tata AIA ULIP plan, you can be rest assured that it will provide you with extensive death benefits that can keep your family’s future secured even in your absence.
- What Are the Top Plans and Providers?
Comparing the plans available is crucial for you to choose the right one. Nowadays, you can do that online by sitting at the comfort of your home in just a few minutes. You can also check the premium amounts through the online ULIP calculator.
- What Are The Long-Term Investment Goals?
ULIP plans are generally long-term, which means that you can invest in them to secure your retirement as well. There are also a few specifically designed ULIP insurance plans that are crafted to suit the policyholder’s needs upon their retirement. Such plans provide a regular payout of money so that you can enjoy your retired life without worry.
- What Are The Applicable Tax Benefits?
Apart from all the many other benefits, a ULIP plan also offers tax benefits to the policyholder. As per the Income Tax Act, the policyholder can get great benefits upon paying the premiums of their ULIP policies.
- What Is the Required Life Cover Amount?
As mentioned earlier, ULIP plans are meant to secure the financial future of the policyholder and their family members. There could be several financial milestones in the policyholder’s life that they would like to plan while investing in a ULIP policy. So, it’s always better to choose a coverage amount that can help the policyholder ensure that their financial milestones are met without any glitches.
With the internet playing a huge role in our lives, comparing and choosing the right ULIP plan isn’t a matter of worry anymore. Also, these policies are a great way to secure your future financially. So, don’t you think it’s the right time to opt for a ULIP policy for yourself and your family?