Types of Unit Linked Insurance Plans and Their Benefits

The unit linked insurance plan was brought into the market, to help investors get a better deal. Usually, when the inflation is high, the value of money reduces. Though, you would have been promised a high sum at the end of 20 years or more, the value is decreased because of this fact. The unit linked insurance plan or ULIP is an insurance plan that helps the value of your money change according to the market.

Types of Unit Linked Insurance Plans

You can say that the ULIP is a combination of a mutual fund and an insurance policy. Through this plan, your money remains stable, though the market has high inflation. You get a number of units depending on how much you want to invest. You money then gets invested in the stock market.

When the inflation in the market is high, the returns match it. Like insurance plans, during the death of the insurer, the assured sum is paid to the beneficiary. Through the ULIP, you are benefitting in both ways. You are not only getting your assured sum at the end of the plan, but you are also getting some money that has been invested in the stock market. 

Benefits of Unit Linked Insurance Plans

Here are some of the benefits of unit linked insurance plans.

Liquidity

You stand to benefit from the high liquidity of this insurance plan. You can redeem your units depending on your requirements. This feature in this insurance plan has made many investors to opt for this kind of plan. There are only some plans that come under this insurance plan that offer this kind of feature.

You never know when the need for money might arise. So, before you sign in for the plan, ensure that the high liquidity feature is available. 

Many Options to Select

When you want to invest your money, you like to have many options to choose from. This way, you can plan your returns. If you feel that the returns are going to be low, then you can always change the insurance plan. In this insurance plan, you can change it as many as three times a year. 

Dual Benefits

When you invest your money in the unit linked insurance plan, you are benefiting daily. As you are going to get higher returns from the units in the stock market, you are gaining more money. At the end of the scheme, you stand to get the inured sum. With this dual benefit for investors, this insurance plan has been popular among many people. 

High Returns

This is not merely an insurance plan. The returns that are got from this plan are higher than insurance plans. The simple reason for that is because your insurance plan has been linked to the equity market. You invest some of your money in the equity market. The remaining money is used as the premium.

You stand to gain high returns from this kind of insurance plan when compared to others.

The above are some of the benefits of the unit linked insurance plan. As an investor, you must ensure that you are investing your money according to your needs and not because you have to invest your money. There is plenty of information that can be got from the internet about this insurance plan.

As you can see, this not only an insurance plan, but also a invest plan with high returns. When you have invested your money wisely, you can meet your financial needs.