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ULIPs combine benefits of insurance and mutual funds, investing a portion of the insurance premium in debt funds or bonds or listed equities and gives a return on investment.

Apnainsurance.com Research Bureau

20 Dec 2007

Unit-linked Insurance Plans (ULIPs) combine the benefits of life insurance policies with mutual funds. A certain part of the premium is invested in listed equities/debt funds/bonds, and the balance is used to provide for life insurance and fund management expenses. Yields earned on investments i.e. the value of the investment or the sum assured, whichever is higher, is paid to the insured or nominee. This varies from company to company i.e. some insurance companies pay the value of the investment in addition to the sum assured.

See also:

FAQs on Life Insurance Basics

Life Insurance FAQs on Premiums

Life Insurance FAQs on Claims

Life Insurance FAQs on Insurance Company and Insurance Agent

Children's Life Insurance Policies

Endowment Insurance Plans

Money-back Life Insurance Plan

Term Life Insurance Plan

Whole Life Insurance Plans