| August 18
ULIPs: 5 myths debunked
Unit linked insurance plan or ULIP, a life insurance product, offers risk cover for the insured together with investment options. In this, a part of the money is invested in stocks, bonds and similar assets, while the remaining part provides the insured with a life cover.
There are several misconceptions surrounding ULIP among individuals due to a lack of proper understanding. Here are some of the common myths associated with ULIP which should never be believed:
ULIP is not pocket friendly
According to Aatur Thakkar, Co-founder and Director at Alliance Insurance Brokers, the first myth about investing in ULIP is that it is not pocket-friendly.
It’s important to note that ULIP plans were expensive way back in 2008. But times have changed.
“ULIPS are affordable and help people stay protected with life covers. It helps in the growth of wealth by getting market-linked returns at the same time. IRDAI also capped ULIP investment charges, excluding the life insurance cover charges at 2.25 percent if a customer stays invested for more than 10 years,” Thakkar explains.