Unit linked insurance plans (ULIPs) have been in the news of late. Earlier, ULIPs were perceived as a high cost and low return investment option and customers were weary of investing into this instrument. However, the advent of digital technology has made the product more cost effective, leading to emergence of new generation ULIPs and a turnaround in the category.
The steady and sustained growth in the category is a testament to this. Private insurers’ new business premium acquired through the category clocked 38% CAGR in the last five years. This clearly indicates that ULIPs are a lucrative proposition for today’s customers and is slowly becoming a pull product.