10 Best ULIP Plans in India to Invest in April 2023
ULIP (Unit-Linked Insurance Plan) is an excellent financial instrument that combines the benefits of insurance and investment. With ULIP, you get to invest in a range of assets, such as stocks, bonds, and mutual funds among others. A ULIP also helps you save taxes. To check the list of the 10 best ULIP plans in 2023, read on.
List of Best Performing ULIP Plans of 2023
Here are the best ULIP plans 2023 in India that you can invest:
| Name of the ULIP Plan | Minimum Yearly Premium |
| Aegon Life iMaximise Plan | ₹24,000 |
| LIC Endowment Plus Plan | ₹20,000 |
| Bajaj Allianz Future Gain Plan | ₹25,000 |
| HDFC Life ProGrowth Plus | ₹24,000 |
| Aditya Birla Sun Life Insurance Wealth Assure Plus | ₹24,000 |
| SBI Life Smart Wealth Assure | ₹50,000 |
| ICICI Pru Signature | ₹30,000 |
| PNB Metlife Smart Platinum | ₹30,000 |
| Future Pension Advantage Plan- Future Pension Active | ₹15,000 |
| Kotak Single Invest Plus Plan | ₹3,00,000* |
Disclaimer: This table is for educational purposes only. Navi doesn’t take any responsibility for the data provided.
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Detailed Overview of Best ULIP Plans 2023
1. Aegon Life iMaximise Plan
Considered as one of the best ULIP plans in India, the Aegon Life iMaximise Plan offers 6 fund options based on investment goals. This cost-efficient plan can be purchased online. It comes with 2 death benefit options.
If a policyholder chooses option 1, the nominee receives a payout that is the highest among the sum assured, the fund value, or 105% of the premium paid.
In option 2, the nominee receives the total sum assured immediately, in the unfortunate event of demise of the policyholder. Additionally, the nominee will be paid income benefits and additional savings benefits.
- Minimum yearly premium: ₹24,000
- Features: 6 fund options, 2 death benefit options, and no premium allocation charge among others
- Premium allocation charges: Zero
- Number of free changes: Up to 4 per year
- Entry age: 18 years
2. LIC Endowment Plus Plan
The LIC Endowment Plus Plan was launched on September 20, 2010. It gives you 4 fund options to invest as per your risk appetite. In the unfortunate event of a policyholder’s death within the policy tenure of this ULIP scheme, their nominee will receive the higher of fund value and sum assured. In the unfortunate event of the policyholder’s death on or after the date of maturity, the nominee will receive the fund value as death benefit.
- Minimum yearly premium: ₹20,000
- Features: An important benefit of this ULIP investment? You can reduce the sum assured any time during the policy tenure. Plus, it gives you 5 optional riders, including death and disability, accident benefit, new term assurance, new critical illness, and premium waiver benefit. Not to forget, you can also claim income tax benefits under Section 80C and Section 10 (10D).
- Premium allocation charges: 7.5% of premiums at the end of the first year, 5% from the 2nd to the 5th year, and 3% from the 6th year onwards.
- Number of free changes: 4
- Entry age: 8 years (completed)
3. Bajaj Allianz Future Gain Plan
Bajaj Allianz Future Gain Plan, one of the best ULIP plans for investment, offers both capital growth and pension protection. This ULIP plan, which invests in market-linked instruments, follows two investment strategies- the Wheel of Life Portfolio Strategy and the Investor Selectable Portfolio Strategy. The total applicable allocation charges and premiums paid are determined as per the chosen strategy. Policyholders can change portfolio investment strategy at any time during plan tenure also.
- Minimum yearly premium: ₹25,000
- Features: Two investment strategies, a very low premium allocation charge, policyholders can choose any policy term and flexible premium payment terms.
- Premium allocation charges: For year 1, the charge is 9% on premiums between ₹25,000 and ₹99,000, 2.5% on premiums between ₹1,00,000 and ₹1,99,000, and zero on premiums exceeding ₹2,00,000. Year 6 onwards, there is no premium allocation charge.
- Number of free changes: Unlimited
- Entry age: 1 year
4. HDFC Life ProGrowth Plus
This is a non-participating ULIP plan that offers market-linked returns in addition to a life cover. You can choose from 10 fund options. Additionally, you get to choose from 2 available plan options – the Life Option comes with a death benefit cover whereas the Extra Life Option has a death and accidental death benefit cover.
- Minimum yearly premium: ₹24,000
- Features: In the tragic event of death of the policyholder, the nominee will receive the greater of the sum assured, unit fund value, or death benefit (Life Option). Under Extra Life Option, the nominee will receive an additional sum assured besides the death benefit.
- Premium allocation charges: 6% for the first year, 2% for the second year, and no charges third year onwards
- Number of free changes: Unlimited
- Entry age: 30 days (Life Option), 18 years (Extra Life Option)
5. Aditya Birla Sun Life Insurance Wealth Assure Plus
This is a non-conventional ULIP plan that helps you build wealth in the long term while also protecting your savings against death, critical illness, and total permanent disability. Policyholders can pick from two plan options- Classic and Assured.
Under the Classic option, the policy benefit is limited to sum assured plus fund value.With the Assured option, the nominee will receive the benefits of the Classic option while also enjoying a permanent disability or a critical illness cover. It ensures that the policy will go on until maturity in the unfortunate event of total permanent disability or a critical illness. Moreover, the insurer will pay the future instalment premiums until the policy matures.
- Minimum yearly premium: ₹24,000
- Features: This flexible plan offers 5 investment strategies, 16 funds, and 2 riders to choose from. Plus, you can claim tax benefits under section 80C and 10(10D) of the I-T Act, 1961.
- Premium allocation charges: 5% of the basic premium payable from the 1st to the 10th year. There are no charges from year 11 onwards.
- Number of free changes: Unlimited, on premiums of ₹5,000 or more
- Entry age: 30 days (Classic Option) and 18 years (Assured Option)
6. SBI Life Smart Wealth Assure
By investing in this market-linked plan, you will receive ULIP taxation benefits, maturity benefits, and death benefits. It offers 7 fund options – bond, equity, bond optimiser, balanced, pure, money market, and corporate – and permits partial withdrawal after the 5th policy anniversary. The death benefit is the higher of the fund value or basic sum assured. For added protection, you can also opt for the Accidental Death Benefit Option.
- Minimum yearly premium: ₹50,000
- Features: It offers Pay policy premium once and continue to receive benefits throughout the policy term.
- Premium allocation charges: 3% of the single premium
- Number of free changes: 2 free switches in a policy year, for premiums of ₹5,000 or more
- Entry age: 8 years for the base policy and 18 years for the Accidental Death Benefit optional rider
7. ICICI Pru Signature
One of the best ULIP policies in the country, ICICI Pru Signature gives you the option to choose from 4 investment strategies, tax benefits under Section 80C and Section 10 (10 D), loyalty rewards, and systematic withdrawal plans among others. It is a great option for those who are looking to diversify their portfolio. However, bear in mind that it has a lock-in period of 5 years.
- Minimum yearly premium: ₹30,000
- Features: Option to invest in a variety of debt, equity, and balanced funds. You also receive wealth boosters every five years from the 10th policy year onwards, a Whole Life Cover option, and full refund of the mortality and policy administration charges upon maturity.
- Premium allocation charges: None
- Number of free changes: Unlimited
- Entry age: NA
8. PNB Metlife Smart Platinum
With this ULIP plan, you can invest in a wide range of 11 unit linked funds, spread across sectors and asset classes. In the tragic event of the death of the policyholder, the death benefit payable will be the higher of the fund value, the sum assured, or 105% of the total premiums paid, subject to certain terms and conditions. You also get 2 plan options – the Wealth Option, which offers whole life cover, and the Wealth + Care Option, which provides critical illness coverage on top of the regular benefits.
- Minimum yearly premium: ₹48,000 for yearly plans, ₹60,000 for half-yearly plans, ₹1,20,000 for monthly plans, and ₹1,50,000 for single premium policies.
- Features: primarily offer wealth option and wealth+care option
- Premium allocation charges: For single premium policies, a charge of 3% will be levied only for the first year. For other policies, a charge of 12% will be applied at the end of the first year, 4.2% from the 2nd to the 5th year, 2.5% from the sixth to the tenth year, and nothing thereafter.
- Number of free changes: Unlimited, provided the value of a switch is at least ₹5,000
- Entry age: 30 days for the Wealth Option and 18 years for the Wealth+Care Option
9. Future Pension Advantage Plan- Future Pension Active
A top-of-the-line ULIP, the Future Pension Advantage Plan comes with a minimum policy term of 2 years for single premium plans and 5 years for regular premium plans. You get to pick and choose from 4 investment options to grow your wealth and build a corpus for retirement. Please note that there is a lock-in period of 3 years.
- Minimum yearly premium: ₹15000 for regular plans, and a minimum of ₹50,000 on single premium plans (6 years and above)
- Features: Option to prepone or postpone your vesting age within permissible age limits and
- Premium allocation charges: 4.5% for single premium policies, and a maximum of 15% at the end of the first year on regular plans
- Number of free changes: 12 per year. ₹100 will be levied on every switch thereafter.
- Entry age: 18 years
10. Kotak Single Invest Plus Plan
With Kotak Single Invest Plus Plan, you will have to pay premium only once and enjoy the benefits throughout the policy tenure. It offers joint life cover for the policyholder and one more family member. While it offers no cash bonus, it gives an assured sum that is 1.25 times the single premium paid, in case one of the insured members dies. In case of a second death, the nominee will receive an assured sum, which is 10 times of the single premium. In the tragic event of death of both the members, the nominee will be paid the highest of the sum assured on the second death, the fund value including loyalty additions, and 105% of the single premium paid. You have the option to set the policy term at 10 years or 15 years.
- Minimum yearly premium: Being a single premium plan, there is no minimum yearly premium.
- Features: Single premium, joint life coverage, and Loyalty Additions at the end of the 10th year for a 10-year plan and the 10th and the 15th year for a 15-year plan.
- Premium allocation charges: 5%, if the single premium if less than ₹7,00,000 and 4% if the single premium is >=₹7,00,000
- Number of free changes: 12 per policy year. For every additional switch, a charge of ₹250 will apply
- Entry age: 18 years for the primary life insured and 3 years for the secondary life insured
Disclaimer: This table is for educational purposes only. Navi doesn’t take any responsibility for the data provided.
Types of ULIP Plans
ULIPs can be categorised into different types based on the following factors:
1. Type of Securities They Invest In
1. Equity Funds
These ULIPs invest in equity and equity-related instruments. The performance of these schemes is impacted by market volatility. Accordingly, these ULIPs are suitable for investors with a high-risk appetite but have a higher returns potential. The primary objective is capital appreciation.
2. Debt Funds
Debt funds invest mostly in fixed-income securities or debt instruments, such as debentures, corporate bonds, and government securities among others.
3. Hybrid or Balanced Funds
Hybrid or balanced funds invest in a combination of equity and fixed-income instruments to generate returns for investors. Such investments are usually less risky in comparison to ULIPs that primarily invest in equities.
4. Cash Funds
These ULIPs primarily invest in cash deposits, term deposits, and money market securities. Accordingly, the risk associated with these plans is the lowest among the different types of ULIPs.
2. Based on Purpose
1. ULIPs for Wealth Creation
Such plans let you accumulate wealth over a period of time and are recommended for young investors.
2. ULIPs for Children’s Future
These ULIPs are set up to provide financial support to your children at different stages of their lives.
3. ULIPs for retirement
These plans are ideal for building a retirement corpus. Therefore, these securities are suitable for long-term investors.
3. Based on Death Benefits
1. Type I ULIPs
Under these plans, the death benefit is the higher of sum assured or fund value.
2. Type II ULIPs
Under these plans, the death benefit will be a combination of the sum assured and the fund value.
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Benefits of Investing in Best ULIP Plans
1. Diversification
A ULIP invests in an assortment of securities and funds, depending on its investment objective. You can choose a plan that suits your risk appetite and goals.
2. Flexibility
ULIPs are extremely flexible because you can optimise your investment strategies, plans, and goals based on your own convenience.
3. Stability
By investing in a ULIP, you can maximise your returns potential and profit margin, since these securities usually invest in a variety of funds over a long period. With a ULIP, you don’t have to worry about market timing or short-term risks.
4. Max Tax Benefits
ULIPs help you maximise your tax benefits under sections 80C and 10(10D) of the I-T Act, 1961. You can claim tax deductions for both the components – investment and insurance.
5. Life Cover
Besides investment and insurance, a ULIP plan also gives you life coverage. So, with a ULIP, you can financially secure the well-being and future of your loved ones, even in your absence.
Documents Required for Investing in ULIP
- Photo ID proof (such as Aadhaar Card, PAN Card, and voter ID Card)
- Address proof (such as Aadhaar Card, driving licence, passport, etc.)
- Income proof (such as salary slips, income tax returns, and bank statements, among others)
- Age proof (such as passport, Aadhaar Card, voter ID Card, etc.)
General Eligibility Criteria Investing in ULIP Plans
- Terms of policy: 10-20 years
- Minimum age of entry: 90 days
- Maximum age of entry: 50 years
- Minimum maturity age: 18 years
- Maximum maturity age: 60 years
Disclaimer: These data points are simply indicative and shouldn’t be taken as absolute. Navi doesn’t take any responsibility for the data provided.
How to Invest in ULIP Plans
- Step 1
Conduct research on various ULIP products available in the market and shortlist them based on their features, benefits, and your own investment objectives.
- Step 2
Carefully assess the benefits and the returns potential of the shortlisted plans
- Step 3
Choose a plan that fits your risk tolerance and investment strategies
- Step 4
To know more about specific aspects of a ULIP, reach out to the issuing company directly. You can easily find their customer care number or office address from their app or website.
- Step 5
You may also consult financial experts for guidance. Purchase a plan if and only if you are completely satisfied.
Tips to Choose the Best ULIP Plans for Your Portfolio
- Choose a plan based on your risk appetite, price tolerance, and expected return on investment (ROI)
- Select the right life insurance cover
- Remain invested for as long as possible
- Verify the pricing and the charges carefully
- Understand your tax implications and benefits
- Compare the features and benefits of similar plans before you select one
Things to Consider Before Investing in Best ULIP Plans
1. Financial Objectives
You should always check your own financial goals before choosing a ULIP plan. Factors, such as your age, savings, current financial situation etc., should be carefully considered.
2. Fund Performance
You should check the NAV (Net Asset Value) and performance of the funds under the ULIP plan.
3. Withdrawal Rules
ULIPs usually come with a lock-in period of 5 years. There may also be restrictions on withdrawal of funds post completion of the lock-in period and conditions on surrender of a plan. Study each of these aspects carefully.
4. Different ULIPs Available in the Market
You may want to compare the features of different ULIPs before buying one. Some of the factors you will want to check are premium rates, returns, benefits, maturity amount etc.
5. Risk Assessment
You should carefully evaluate the risk profile of a ULIP plan and choose the right fund option. If you have the capability to bear high risk, you may choose to consider ULIPs that primarily invest in equity. On the other hand, if you want stable returns, you might want to consider plans that predominantly allocate funds to debt instruments or money market instruments.
6. Investment Horizon
ULIP plans work well if you have a long-term investment horizon as they have a lock-in period of five years or more.
Taxation of ULIPs
Premium paid towards top ULIP plans is eligible for income tax deductions under Section 80C. Under this, you can claim a maximum tax deduction of Rs. 1.5 lakhs. Additionally, returns from this investment are exempt from income tax under Section 10(10D) of the IT Act.
However, this maturity benefit is available only for policies bought before 1 February 2021. For policies issued after this date, the maturity benefit is taxed as a capital asset if the policy’s annual premium exceeds Rs. 2.5 lakhs.
Moreover, pay-outs to nominees in case of accidental death of the policyholder are completely tax-free. Similarly, partial withdrawals up to 20% of the fund’s value are also exempt from taxation as per Section 10(10D).
Final Word
ULIPs allow investors to steadily grow wealth while also financially securing the future of their loved ones. With the best ULIP plans 2023, you can also create a large corpus to accomplish your life’s goals, such as children’s education, marriage, or building a nest egg.
But if you’re looking to invest in a range of low-cost securities, try Navi Mutual Fund. With Navi Mutual Fund, you get exposure to a host of sectors and asset classes. What’s better? You can start investing with as little as ₹10.
FAQs
Yes. ULIPs are certainly an option worth considering if you are looking to fulfil long-term goals like buying a new car, house or marriage.
The total value of all the units held by the policyholder of a ULIP policy is called the fund value. It is calculated as the number of units held multiplied by the net asset value (NAV) of a fund.
Surrender charges refer to the fee imposed on the policyholder in case of a partial or full withdrawal before the maturity period. The surrender charges depend on the fund value and the year in which the policy is surrendered.
You need to initiate a surrender request with your insurer to cancel the ULIP policy. However, you can get the amount after the completion of the lock-in period.
Yes, you can move your investment from one fund to another within the same plan.
In comparison with Fixed Deposit, ULIPs are considered more beneficial as it offers you life cover other than keeping your funds safe.
A Unit-linked Insurance Plan is a life policy that offers the dual benefits of capital growth and insurance. The premium you pay for this plan works in two parts. One part acts as an annuity plan. This means it contributes to your savings for the old age. The second part is invested in funds that you can choose as per your risk appetite and investment goals.
ULIP has an upper hand over some mutual funds for various reasons. First, ULIP investments are easier for inexperienced and risk-averse investors as they do not have to separately select funds and get an insurance policy. The earnings from your ULIP plan also add up to your annuity savings thus promising high maturity benefits upon retirement. In terms of taxation, you can enjoy more tax deductions by investing in ULIPs than mutual funds.
An average ULIP plan offers 10-12% returns depending on the investment amount and the market. This may vary between plans, maturity periods and market conditions. These are comparatively better options than other financial instruments like fixed deposit and equity funds in terms of long term returns and tax deductions.
ULIP schemes invest in several equity and debt instruments along with savings for one’s old age. As a result, returns from ULIP highly depend on market performance and the nature of the funds. Owing to the volatile nature of the market, ULIPs are categorised as high-risk investments.
You cannot withdraw your ULIP premium before its locking period ends which is usually five years. Partial withdrawal is not allowed in the case of ULIPs. Therefore, if you are planning to invest in this plan, be sure that you don’t need that money urgently in the coming five years.
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Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
