Unit Linked Insurance Plans or ULIPs are insurance cum investment plans. ULIP offers life insurance cover and an opportunity at wealth creation. Part of the premium goes towards mortality cover and the remaining amounts are invested in equity, debt or a mix of both, depending on the type of ULIP. ULIPs help achieve financial goals of retirement planning, investment planning, tax planning and children’s education planning among others.
ULIP is a long-term investment which has a 5 year lock-in period. Insurance agents sell ULIPs promising great return on investments. ULIPs are also marketed as tax saving investments. The purpose of availing insurance is risk protection. Sadly, ULIP offers low mortality cover and insurance agents don’t inform people which is cheating and fraud.
Indian Money review Bangalore say never mix insurance with investments. ULIPs offer low mortality and have high charges. An IndianMoney dot com review says ULIPS deduct premium allocation charges, mortality charges, policy administration charges and some other charges before investing in debt or equity. This reduces the return on investment. IndianMoney complaints say many people are dissatisfied with ULIPs as they get cheated by low returns and hardly any mortality cover.
Indian Money reviews advice availing a pure risk protection plan like a term life insurance plan and invest in equity or debt based on risk profile. If you are an aggressive investor, invest in equity mutual funds or stocks. A conservative investor can look at FDs, post office schemes or FMPs.
IndianMoney Complaints: Compare ULIP Plan, Review and Benefits
Compare ULIP Plans: Reviews and Benefits:
IndianMoney reviews say understand ULIPs before availing them. ULIPs have a lock-in of 5 years. Being dissatisfied with the ULIP means you have to surrender ULIPs. You feel cheated as there are surrender charges.
Insurance agents sell ULIPs to pocket commissions. When you feel cheated and look to exit ULIPs, insurance agents advise surrendering ULIPs and availing Endowment plans. This is churning and helps insurers earn more commissions. This blatant cheating and fraud has brought a bad name to the insurance sector in India.
IndianMoney.com reviews say most of the premiums paid on ULIPs go towards investments, leaving very little for insurance. You would be better off investing in mutual funds regulated by SEBI. It’s difficult to measure performance of ULIPs vs Mutual Funds.
Indian Money Bangalore say never invest in ULIPs if you can’t bear risk. ULIPs are market-linked investments and you could lose money. ULIPs are not a good investment for people with no regular income. Premiums have to be paid regularly unlike SIPs in mutual funds, where you can stop SIPs on not having the money. Surrendering the ULIP incurs surrender charges.
Insurance agents cheating and fraud:
IndianMoney reviews say insurance agents cheat customers saying ULIPs are like bank FDs. Insurance agents say ULIPs are just like bank FDs with the added insurance benefit. Insurance agents say ULIP illustration benefits offer 4% and 8% which are just like bank FDs. ULIPs also enjoy tax benefits vis-à-vis FDs. When customers lose money, this is cheating and fraud.