Get the Right Coverage
ULIP is an acronym for Unit linked Insurance Plan. It is a type of life insurance plan that helps to manage your investments by providing protection against risks and flexibility to alter the funds allocation. A certain part of the premium you pay goes towards providing the life cover and the balance is invested in different types of instruments keeping in mind the goals you have set. These plans serve a dual purpose of giving you a life cover and also, working towards making your investments grow.
If you want to benefit from a ULIP you should have a longer investment perspective because ULIPS work best when invested for a longer period of time with various investment options. Basis your RISK appetite you can choose your funds mix. Selecting a right balance for your investment’s exposure to equity and debt funds will definitely protect you from the ups and downs of the market performances and provide you with higher returns.
Another advantage is that ULIPs are very flexible, meaning which you have the option to partially withdraw money from your funds should an urgent requirement arise. In case you have surplus funds at any point in time and wish to invest in your ULIP that is performing good, you can park your funds in the plan through a TOP-UP facility.
How does a ULIP Work?
A ULIP works on 2 fronts – a) towards providing a life cover through adequate insurance and b) towards wealth building.
Initially for the first few years a good part of the premium is allocated towards meeting policy expenses. Once these expenses are deducted the balance premium is divided between proving life insurance and making an investment. You choose a fund depending on your risk appetite and you
The premium in a ULIP goes towards meeting the insurance needs and towards building wealth. In the initial policy years you may not see very high returns as a good part of the premium goes towards policy expenses. But since you will remain invested for a long term, the returns you reap by far exceed normal insurance plans through fund management.
The premium is divided between providing a life cover and making an investment after expenses are deducted. Units are allocated for the amount invested, in a fund of your choice. The fund could be equity, debt, or a combination of the two. The value of the units allocated depends on the performance of the underlying fund.
Making the Most of Your ULIP
Have clarity on your Objective:Your primary objective should be to have sufficient life insurance cover to protect yourself and your family from unanticipated events. You should calculate the required life cover on the basis of your age, income, and dependents.
Have a Long Term vision:ULIPS are long term investments. You will reap high returns if you stay invested till maturity. You mustn’t use them as short term investment vehicles to earn quick gains.
Have a tailor made plan to match your requirements:ULIPs have a facility of choosing from various add-on benefits to customize a plan.
Park surplus funds through Top ups:For an incremental amount over your regular premium, you could increase your investment component in the base policy. In such cases, you can avail partial withdrawals only after five years.
Riders:You can choose from various riders like accidental death or disability benefit, or a critical illness cover to give you an additional cover along with the base policy.
Switches:In case at a certain time your RISK profile changes and you need more or less exposure to equity or debt, you can regulate your funds and switch them accordingly.
Advantage of Anar Insurance
Anar Insurance encourages savings in the form of investments.Premium given for life insurance acts as savings for future.It helps in collecting and securing funds for security and safety for future needs.
Financial security is utmost important for survival in today’s world.Safeguarding family’s finances thru different kinds of insurance can be beneficial and act like a security for future.
The pooling of risk can be done from one or more sources. Hence spreading/dividing the burden from a single source.The risk could be single or multiple types.
Promotes business activities
Insurance activity builds and shapes different kind of opportunities as multiple service providing companies are linked once the insurance is matured.
Provides employment opportunities
Insurance is a progressive industry and with introduction and development of new policies in helps in creating new job opportunities which requires special skill sets.
Maintains economic stability
It converts accumulated capital to productive investments.It also helps in financial stability and promotes trade and commerce for economic development and growth.
Assures financial compensation
A financial compensation is provided in many types of insurance. If we take an example of Life Insurance, we realize that once the term has ended or due to the demise of the insured, the compensation is given to the family.
Why Anar Insurance ?
Anar Insurance works towards simplifying and speeding up the process of buying insurance and financial services from varied available options by combining complete, impartial online information with the offline help of experienced insurance professionals.
- Providing security.
- Spreading Risk.
- Encourage savings.
- Source of Collecting funds.
- Provides employment opportunities.
- Maintains economic stability.
- Promotes business activities.
- Assures financial compensation.
- Reduces financial losses.