Hyderabad: ULIPs can be defined as a hybrid scheme that meets an individual's insurance and investment requirements. The premium paid is deductible for insurance coverage and the rest is invested in funds at the discretion of the policyholder. Another attraction is that the premium paid is tax-deductible up under the Section 80C limit. Policy maturities with an annual premium of less than Rs 2.5 lakh are tax-free under Section 80CCD. Apart from these, there are other factors to consider when taking a policy.
The nominee is entitled to compensation in the event of any untoward incident to the insured policyholder of the appropriate amount. You need to decide how much the policy will cover when you take ULIP. It should be noted that the insurance policy should take a big responsibility of the family in the event of unfortunate events. That is, the family should take a policy for the amount required to avoid financial hardship. If there is no problem for the policyholder .. the policy should be chosen to repay the mortgage charges after maturity.
You have to bear additional costs like policy management costs, premium allotment charges, top management charges, top-up charges, mortgage and ancillary policies. Depending on the insurance companies, these can vary. Before contacting the insurance company for the policy you should know about these additional charges. Do not forget that the amount that goes into these from the premium paid also affects the returns. Charges are generally lower for the new generation of ULIPs that are coming now. ULIPs are long-term schemes. Therefore, the company should consider the credibility and claim payment history when taking these.
Debt schemes should be preferred by those who cannot afford the risk when choosing investment schemes based on objectives. Those who want a good return can look at equities. Hybrid funds can also be selected as a combination of equities and debt funds. When taking a policy you need to compare policies that are tailored to your goals. The performance of the funds, past history should be looked at, says Reshma Banda, Executive Vice-President, Bajaj Allianz Life.
