ULIP’s – What are you investing in?

We are not against ULIP’s floated by many insurance companies in India , but we are totally against the way Unit Linked Insurance schemes are sold by insurance company representative’s and insurance advisors.

Can you compare a ULIP and Mutual Fund alone on any parameters ? The truth is a big NO.

Can you compare ULIP with only term insurance plans ? The answer is again a big NO.

Can you compare ULIP with a Term Insurance Plan + Mutual Funds ? The answer is quite possible.

We recently tried to compare ULIP with a traditional insurance plan like Term Insurance and Mutual fund ( ULIP and Term Plan + MF investment). We called a representative from an insurance company and asked for a comparison of ULIP and Term Insurance plus MF investment and to our shock what we got was a comparison of ULIP with MF investment comparing the Fund Management Charges and showing ULIP as a better investment option than Mutual Fund. The lady had not taken into consideration the Administrative charges and the Mortality Charges.

Please be very cautious when you are planning to buy any Unit linked Insurance Plans and do not blindly accept the EXCEL sheet or illustration shown by the insurance company representative. The fact is very few people will give you a correct working. Every insurance representative will show his insurance plan as best compared to any other offering in the market, obviously he has his own loyalty and a big factor is the commissions are very high and people do not understand it properly.

When it comes to comparison of ULIP it has to be with a pure insurance plan along with investment’s, Why ? because a ULIP or Unit Linked Insurance Plan is a combination of Insurance and Investment and therefore the comparison has to be made with a pure insurance cover and investment’s in Mutual fund.

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Getmeinsure.com Team, India


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