If you invest in a Unit Linked Insurance Plan (ULIP), your returns depend on several factors, from the type of ULIP plan you have to the returns you get from the underlying assets (shares/bonds/other) and even your insurance company’s claims history on your policy.
The good news is that there are several things you can do to maximize the returns from your ULIP plan—and we’re here to help you out with that! Read on as we tell you about 8 ways to maximize the returns from your ULIP plan!
Table of Contents
1) Know your investment options
ULIPs offer a range of investment options, which provide different levels of risk and returns. To make your ULIP plan work for you, consider the following:
These funds invest in a range of securities such as stocks, bonds, and money market instruments. They provide higher returns than other funds but are also associated with a greater level of risk.
2) Go with a conservative fund
If you’re looking for a way to invest your money and make some decent returns, then a ULIP plan is probably one of the best options.
However, you must use caution when choosing a company because not all companies are created equal.
One of the things that you can do to make sure you’re getting the most out of your investment is by investing in conservative funds.
3) Reduce costs by going online
They are usually more expensive than traditional insurance policies, but there are ways to reduce costs by shopping online.
Remember that the best deal isn’t always at the first website you find. Consider a few sites and compare quotes before making your purchase decision.
4) Diversify your portfolio
If you are investing in a ULIP plan, it is recommended that you diversify your portfolio across different asset classes so that one type of investment does not become too much of a risk.
In this way, if there is a downturn in the market, you will still have a chance at making some returns.
5) Invest in good quality bonds
Investing in good quality bonds is a great way of ensuring that you get a return on your money when it comes to maturity.
When investing in bonds, you must stay within your risk tolerance levels so that you are not too conservative and miss out on gains, or too aggressive and lose all of your investments.
The best time to invest in bonds is when interest rates are low or when there is a high degree of uncertainty about equity markets.
6) Get tax relief on premiums
ULIPs are tax-saving investments that offer protection against a range of life risks such as accidental death, permanent disability, terminal illness, and old age. You can also get tax relief on premiums if you’re in any of these categories:
- A senior citizen aged 60 or above.
- A person with a monthly income of up to Rs. 15,000.
- Retired persons with a monthly income of up to Rs. 20,000.
7) Choose your Ulip wisely
One of the best things you can do for your retirement planning is investing in a ULIP. However, not all of them are created equal.
You need to choose your plan wisely and ensure that it has low expenses, low entry loads, and a good track record of returns.
Choose an Ulip with tenures that match your risk profile and keep an eye on how your funds are being invested.
8) Buy only when you need
It is best not to buy a ULIP plan for your child until he or she needs it. The cost of a plan will be dependent on the age of your child when they first start using it.
If you are buying a plan for a newborn, you will need to buy one with a higher premium than if you were buying it for an 18-year-old. However, if your child does not need any medical coverage before their 19th birthday, then get them one as soon as possible (the sooner the better).
We know that deciding whether or not to purchase an insurance policy like Canara HSBC Life Insurance – Invest 4G Plan is a big decision—which is why we offer free instant quotes online so that you can see exactly how much coverage would cost before making any decisions! Life insurance can be daunting, but it doesn’t have to be. At Canara HSBC Life Insurance Invest 4G Plan we make it easy for you to understand what type of coverage will work best for your family’s needs. Let us help protect the people who mean the most to you with our Invest 4G Plan.
Conclusion
A ULIP plan (Unit Linked Insurance Plan) can be an excellent investment option in India, providing the right balance of growth and protection to your assets, while saving on taxes as well. But to get the most out of it, you need to be smart with your investments. We’ve listed above eight ways that help you maximize the returns from your unit-linked insurance plan, whether you have just started investing or are thinking about shifting your funds into one.
