ULIP plan Suggestions

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Deal Cadet
shivanshu.k507

To offset my investment and tax savings I want to opt for a ULIP plan . Can you suggest best ulip plan for 15 years and premium looking for 2.5 lpa.

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Generous Generous
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why on Earth will you take ULIP ?

Benevolent Benevolent
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stay away from ULIP. Only the insurance co and the agent benefits from ULIP.

Get a pure term insurance plan and invest the remaining in PPF (if you are looking at 15 yr plan) and/or in NPS (if your are looking longer). 

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Benevolent Benevolent
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go with small saving bank tax saver fd for much better return

Deal Cadet Deal Cadet
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Take a look at this and compare your tax saver FD returns in same time duration . imagepickerDDA07E94-B9F3-4988-B532-6486A3BEDE15-12619-000005D5E36C4977

Generous Generous
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why on Earth will you take ULIP ?

Deal Cadet Deal Cadet
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because in Mutual Fund you give LTCG but in ULIP all your maturity amounts is TAX FREE.
Helpful Helpful
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1. Why 2.5 lakh per year??  80c limit is 1.5lakh

2. PF is part of 80c, as part new salary structure bill passed, I think all salaries must be structured 50:50 basic and bonus/addons etc. so PF would keep increasing year on year and cover full 80c limit.

3. Since you are able to spare 2.5 lpa on ULIP, your salary is already high, so as the PF.

4. If you are thinking of insurance and investment please separate them but a term insurance and remaining into MF.



Deal Cadet Deal Cadet
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countribution till 2.5 is non taxable on exit
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Post Emperor Post Emperor
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ULIP IS 💩

Benevolent Benevolent
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stay away from ULIP. Only the insurance co and the agent benefits from ULIP.

Get a pure term insurance plan and invest the remaining in PPF (if you are looking at 15 yr plan) and/or in NPS (if your are looking longer). 

Deal Cadet Deal Cadet
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not always true you can put money in single premium ulips and upto 2.5 lakh is exempted from tax
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Deal Lieutenant Deal Lieutenant
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Suggest you to never mix investment with insurance.

Some banks offer insurance with premium variants of savings account, going for them is suggestible.

Helpful Helpful
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ppf+term insurance 

no ulip

Deal Cadet Deal Cadet
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Stay away from ULIP

For term insurance stick pure term insurance

Helpful Helpful
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The best ulip plan is none of them.


Get a term insurance (again, ideally not one with premium return plans, just pure insurance) and invest the test of the money you saved in the avenues. ELSS, NPS, PPF are some options. Even the insurance premium counts towards your 80c limit. 

Deal Cadet Deal Cadet
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yes guys you are smart enough to say dont take ulips but but but ulips are not taxed and sometimes they can outperform regular mutual funds , see lla’s money minded mandeeps entire video end to end, to understand
Benevolent Benevolent
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single premium ones? yeah those maybe r better for hnis but now tax free is capped upto 2.5L/yr anyway so maybe even hnis will move to mutual funds 
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Deal Cadet Deal Cadet
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I think most of the people only watched YouTubers which say ulip is bad and mutual fund is good. but what about tax on maturity returns . for example tata ulip gave 28 percent returns and tax free . better than mutual fund . that too you get life insurance free as well in some ulips.
Benevolent Benevolent
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Has any ULIP given 28% return on real investment component? Not to my knowledge.

What is the real return on investment for ULIP? ULIP is a composite product consisting of insurance and investment. ULIP cannot be offered without insurance. The real cost of the insurance component is the premium payable for availing pure term insurance of equal coverage. So once the true insurance premium i.e. the equivalent pure term insurance premium value, is deducted from the ULIP amount, the balance left is the pure investment amount. Now if we compute the rate of return on this "pure" investment component, NPS is giving much better return. For many ULIPs, even PPF used to give better return, until the PPF interest was drastically cut down last year.

Just for academic sake, I considers ULIP plan of HDFC life, giving DOB of 01/01/1994 (30 yrs) and annual investment of 1 L for 15 years. The calculator gave sum assured of 10 L (the insurance part) and ecxpected return after 15 yrs as 25.35 L.

I also got the pure term insurance annual premium for a person with same DOB and SA of 10L to be 920 only. So the "real" investment component in the ULIP is 99080 (1L - 920).

If I invest 99080 every year in PPF for 15 years, at present rate of interest the maturity value would be 26.87 L. And PPF is 100% tax free.

If the same money is invested in NPS the return would be around 41 L (even with a conservative return of 12% - NPS has given more than 14% returns for last 7 years). Out of this, 60% (about 24.80 L) would be lump sum tax free return. The balance is also tax free and only the further income one would get out of this would be taxable. 

So same 1 L every year for 15 yr in ULIP would give 25.35 L and in PPF + term insurance would give 26.87 L and in NPS + term insurance would give at least 41 L. 

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