Picture this: You have these extravagant dreams of owning a fancy car, sea-facing bungalow, or taking your family to an island getaway. Keeping all your financial concerns at bay, you decide to chase your much-awaited dream. As difficult as it may sound, it can be turned into reality. This is possible with an investment in a Unit-Linked Insurance Plan (ULIP).

A ULIP Plan is your safety mechanism against all the unfortunate events that occur in your life. This is because it not only protects your family needs but also lets you invest in equity markets. Additionally, it keeps your risk bearing appetite in check by allowing you with a multiple funds option. So if you’re looking for a plan that provides dual benefits of protection and growth, keep reading:

ULIP as a risk management tool

1 Risk management

Risks can be associated with any sudden, unforeseen events. Moreover, risk involving any insurance plan is typically perceived as death, accidents or fire emergency. However, this is not the case when it comes to ULIPs.

A ULIP Plan effortlessly manages three types of risks. First, it comes with the standard lock-in period that prevents our impulsive habit of spending on the funds. Second, it offers features like fund options, automatic profile booking, and fund switching provisions. Third, it covers the risk of market volatility and a lack of financial discipline.

2 Flexible investment

When it comes to ULIPs, flexibility can be labelled as a major benefit. Compared to other investment plans, a ULIP ensures absolute flexibility with its multi funding options. Invest in only top performing ULIP funds, if you’re looking for flexibility as per your needs.

When you invest in a ULIP, you get to invest based on your risk appetite and return expectations. This guards all your investment against the risks of capital markets and also boosts the overall performance. The flexibility of ULIPs makes it a safe option to invest your money for a longer run.

3 Partial withdrawal

If you’re looking forward to sticking to one plan for a longer period of the plan, ULIPs should be your go-to. Having said that, a ULIP Plan ensures that you stay on one financial pathway. This simply makes it your lifetime partner throughout every financial exigency.

A ULIP Plan provides an investor with an option to either withdraw or add onto the financial corpus over a longer period. Moreover, it allows every investor to schedule systematic withdrawals in order to supplement income. An investor can also enhance all his investments during the years of earning for a given future goal.

4 Value for money

An investment in any ULIP plan not only offers you with dual benefits of growth and protections but also promises your investment in equity markets. Due to regulated as well as defined reduction, the value for money is looked after. ULIPs also include a life cover that may comparatively be cheaper in the long run, due to their return on mortality charge feature.

5 Life cover

In order to meet one’s financial aim, an insurance plan offers life covers. And the exact same case is with a ULIP Policy. A life cover secures your family needs in case of your unfortunate demise.

Reasons to Invest in ULIPs

As you can clearly figure out by now that none of these features are offered by other insurance policy. This simply makes ULIP a comprehensive risk management tool. Hence, if anyone asks, “What is ULIP?” or “Why should I invest in a ULIP plan?” again, you know what to say.