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When it comes to investing your hard-earned life savings, you definitely want the best financial medium that is safe and offers the best returns to help you create a sufficient corpus for your future. However, it is equally important that the medium you choose comes at an affordable price as well which is sustainable in the long run. This is why a ULIP which initially started out as a unique investment and insurance product for the Indian customer (but was highly expensive at that) had to undergo several changes over the years.
It has now emerged as both affordable and with increased benefits. It’s only when a financial product can reform itself to suit the needs of the investor can it actually sustain in the market amid tough competition. Here we discuss how a 4th generation ULIP (as it is famously now called) has changed the face of the life insurance sector in India. Read on.
A ULIP full form stands at Unit Linked Insurance Plan. It is one of the most unique financial products in the kitty of the life insurance sector, offering dual benefits of insurance and investment to the financial investor. This is why ULIPs gained immediate popularity when they were first launched several years ago because there was no other financial product at the time to compete with them in this regard.
However, the ULIP had one major drawback back then. They were highly expensive (perhaps owing to the exclusive dual benefit they offered). This meant that the common Indian investor couldn’t quite afford them. To sustain the changing financial investment market, the ULIPs have undergone several reforms and regulatory transformations all these years to now emerge as evolved 4th generation ULIP or New Age ULIPs (NULIPs).
We discussed in the above section the ULIP meaning and how it has evolved over the years to suit the customized needs of the young millennial investor. Was it just the price drop or were there any other reforms introduced in the conventional ULIP during its journey to transform into a NULIP? Let’s find out.
Another advantage that the 4th generation ULIP offers is that it allows the investor to withdraw a partial amount of their savings to meet any unexpected financial contingency. The early ULIPs did not have such flexible features. There had been restrictions on the investor on fund-switching during the policy tenure and also on the partial withdrawal amount permissible. The 4th generation ULIP did away with these restrictions and also completely removed the charges on fund-switching. Moreover, partial withdrawal is now permissible up to 95% of the funds invested.
If you’re looking for easily affordable ULIP plans to invest your funds in this year, here are some options for you:
ULIPs are and have always been one of the top preferred options for investors in India, considering the fact that they offer dual benefits of insurance protection and wealth creation. With the millennial investor actively participating in market dynamics, the NULIPs or 4th generation ULIPs are fast picking pace, thanks to the regulatory reforms they have undergone over all these years.
If you are looking for the best ULIP policy to build an adequate corpus for your future, visit PayBima that presents some of the top-notch options for investment for all financial goals. You can also look up the premium payable on each ULIP by using the ULIP calculator available on the website.
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