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A Quick Guide to Unit Linked Insurance Plan

  6/23/23 7:19 AM

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ULIP plan is an insurance product that offers your loved one’s financial coverage against any unforeseen events and enables you to make smart market-linked investments.

 

Features of ULIP

 

  1. Fixed Premiums: When you buy a ULIP plan, you need to pay a fixed premium amount for the life cover you have selected. You can use a ULIP calculator for assistance.
  2. Insurance + Investment: A portion of the premium you paid offers insurance coverage to you. The balance portion is invested in debt or equity instruments.
  3. Flexibility to Switch: ULIP plans allow you to switch between the ULIP funds you invested during your premium payment.
  4. Lock-in period: According to IRDAI, ULIP insurance has a lock-in period of 5 years.

 

Benefits of ULIP:

 

  1. Liquidity: ULIP plans allow you partial withdrawal, wherein after the lock-in period of 5 years, you can withdraw funds from your ULIP as per your needs.
  2. Regular Saving: ULIPs help you inculcate the practice of regular saving to build a large corpus for future needs.
  3. Spread of Risk: As your funds are invested in various stocks, your investment market risk is minimised.

Tax Benefits:

  1. The premiums paid towards your ULIP plan are exempt from tax as per Section 80C of the Income Tax Act.
  2. The life cover payout to the beneficiaries is exempt from taxation under Section 10 (10D).
  3. The maturity benefits are tax-free if the total annual premium is less than ₹2.5 lakhs.
  4. The maturity benefits are taxed as Long-Term Capital Gains if the total annual premium exceeds ₹2.5 lakhs.

 

To obtain the best ULIP plan returns, check the Edelweiss Tokio ULIP plan - Wealth Secure Plus today.

 

To learn more about our offers and ULIP plan charges, visit us today at https://www.edelweisstokio.in/wealth-secure-plus

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