Saturday Jun 15, 2024

Ways You Can Shield your Life &Wealth with a Life Insurance Policy

One cannot overstate the importance of financial stability in today’s climate of ever-growing inflation and uncertainty. You work hard for it, and once you reach a place where you are riding the waves of prosperity, the thought of having a contingency plan becomes unpleasant. After all, who wants to think about their demise or a financial crisis in good times? As a result, there are many families who do not have a secured financial future.

After knowing this, you might wonder what course of action you must take. And the answer is to opt for a multipurpose Unit Linked Insurance Plan (ULIP). 

Life insurance plans have long been the most recommended and opted-for insurance policies globally, simply because they help an individual fulfil an essential duty towards their family. But standalone life insurance policies do not do much when it comes to monetary returns; they are investments, but only figuratively.

This is where a Unit Linked Insurance Plan (ULIP) comes in. A multipurpose, flexible life insurance policy that can giveyou life cover as well as wealth creation capabilities simultaneously. Let’s take a deep dive and understand ULIPs better so that you can see how they are the perfect plans for providing holistic financial security to you and your family.

What are ULIPs?

Unit Linked Insurance Plans come under the category of life insurance products. In fact, they hold a unique place among them because they provide a death benefit as well as handsome returns on investments.

This is achieved by the dual purpose of the premiums that you pay. One portion is directed towards giving you life cover, and the other portion is invested in a market-linked financial vehicle of your choice. These can be chosen from a pool of diverse funds that are either equity-based, debt-based, or a balance of the two.

What are the Key Features of ULIPs?

  • Flexible

Unit Linked Insurance Plans provide great flexibility to the investors in terms of the choices, the varying levels of risks, and the ability to switch funds without incurring any charges.

There are 5-7 mutual funds with varying amounts of risk and return that they offer. So, if an investor’s risk tolerance is high and they want to maximize their returns, they can choose an equity fund. On the other hand, debt funds offer lower returns but with lower risks.

The best part is perhaps that you are never stuck with a fund in case your expectations are not being met. The investor can always switch from a high-risk to a low-risk fund without any extra charges and ensure that the corpus is on the correct trajectory.

  • Tax Benefits

All ULIPs provide tax benefits in the form of tax exemptions. Under Section 80C of the Income Tax Act, 1961, the premiums you pay up to INR 1.5 lacs are exempted from taxation. Additionally, the bonuses and sum assured that you get are also tax-free under section 10(10D).

  • Partial Withdrawals

Modern ULIPs have an initial lock-in period of 5 years, set by IRDAI to ensure that a decent corpus is built asUnit Linked Insurance Plans need time to show results.

After this lock-in period, though, you can make partial withdrawals during the entire term of your policy to get any financial assistance. It is, however, not advised because you want your corpus to grow to its maximum potential.

  • Affordable

When ULIPs were first introduced, they were infamous for being expensive and low-yielding products and did not have much going for them. But since 2010, they have had a resurgence, thanks to better regulatory interventions and the innovation of companies like Edelweiss Tokio Life Insurance.

Today, ULIPs are among the affordable policies that are a must-have in any financial portfolio. They are also transparent about the charges that are involved, and with online insurance becoming the dominant thing in the market, this is the right time to invest. Policies like Wealth Secure+ by Edelweiss Tokio Life Insurance are available for as low as INR 1000 per month.

How can they Help You?

There are a multitude of use cases for ULIPs. The truth is, with the presence of riders and the facility of fund management that is on offer by some companies, ULIPs have become lucrative. They are viewed as a solid retirement planning option, a good child insurance plan, and a tremendous multipurpose corpus that you can save for contingency. This way, the wealth you have right now stays intact and can bail you out in the worst of times.

Not to mention, the life cover that Unit Linked Insurance Plans provide can make a huge difference in your absence.


If you have not invested in a Unit Linked Insurance Plan yet, it is the right time to do so. The market uncertainty might seem like a deterrent, but ULIPs are well equipped to deal with this scenario. The main thing is that your life and wealth can be secured with a single policy, and that is an option that is rare, even in today’s market.

Edelweiss Tokio Life Insurance has a diverse suite of ULIP plans that are comprehensive, affordable, and extensive. You can check them out on their website and select the right one for yourself today!

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