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Part - IV

ULIP is suitable for individuals who are already adequately insured and are reasonably well informed and savvy to take active investment decisions by using the 'switch option' that is provided to a ULIP policyholder. Also policyholders with regular endowment plans that are not satisfied with the 4-6 per cent returns can consider taking a ULIP with a lower equity component.

Market Factoid

1. The growth options of ULIP have recorded annualised returns of over 20 per cent.

2. Various charges amounting to approximately 25 per cent in the initial years in all the schemes.

3. Most companies normally allow customers to switch, a fixed number of times annually from one fund to other fund. Later, they charge approximately Rs.100 per switch.

4. Private insurance companies 50 per cent sales up because of ULIPs today.

5. Individuals availing tax exemption under section 88 of Income Tax Act.

6. New Schemes coming into the market, which covers life insurance and accident insurance.

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* Contributed by -
A.Sathish Kumar,
Asst. Professor,
Vivekananda PG College,
Karimnagar (AP).