Savings
2025-12-16 3 Min read
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ULIP Disclaimer
IN ULIPS, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER. THE LINKED INSURANCE PRODUCTS DO NOT OFFER ANY LIQUIDITY DURING THE FIRST FIVE YEARS OF THE CONTRACT. THE POLICYHOLDER WILL NOT BE ABLE TO SURRENDER OR WITHDRAW THE MONIES INVESTED IN LINKED INSURANCE PRODUCTS COMPLETELY OR PARTIALLY TILL THE END OF THE FIFTH YEAR.
Assuming you could wrap your head around all the ULIP jargon floating around, what would it actually take for you to pick the right one?
You'd definitely want clearer understanding about fund performance, straightforward cost breakdowns, easy switching between funds, decent customer service when you need help... all of that and probably some guarantee that you wouldn't get buried in paperwork. And would you buy one without understanding the ULIP plans first? No, right? That would barely cover the peace of mind you need when mixing life insurance with wealth creation.
Admittedly, you might be someone who gets confused by financial products (not sarcastic), so maybe you wouldn't need all this handholding to choose ULIP insurance. There are plenty of people who dive into market-linked products without breaking a sweat, from equity funds to debt funds, which attract experienced individuals who have had a decent share of experience.
But let’s say you are someone who’s only starting to understand how exactly to go about ULIPs, well, this is how you go about selecting one, for starters -
Assuming you could wrap your head around all the ULIP jargon floating around, what would it actually take for you to pick the right one?
You'd definitely want clearer understanding about fund performance, straightforward cost breakdowns, easy switching between funds, decent customer service when you need help... all of that and probably some guarantee that you wouldn't get buried in paperwork. And would you buy one without understanding the ULIP plans first? No, right? That would barely cover the peace of mind you need when mixing life insurance with wealth creation.
Admittedly, you might be someone who gets confused by financial products (not sarcastic), so maybe you wouldn't need all this handholding to choose ULIP insurance. There are plenty of people who dive into market-linked products without breaking a sweat, from equity funds to debt funds, which attract experienced individuals who have had a decent share of experience.
But let’s say you are someone who’s only starting to understand how exactly to go about ULIPs, well, this is how you go about selecting one, for starters -
A Framework for Smart ULIP Selection in 2026
What you actually get when you start looking at ULIP insurance is a whole lot of technical terms thrown at you. Fund value, NAV, premium allocation charges, mortality charges and so on. You didn’t sign up to order a coffee asking to be schooled in a chemistry lesson instead.
But here's what you actually need to know about the ULIP plans. When you get a ULIP plan, the premium you pay gets split two ways. Part goes toward life insurance coverage (so your family is protected), and part goes into funds available in the product. You can choose equity funds, typically high risk, if you want growth or choose debt funds, if you want stability, or choose a mix of both these funds in case if you want to balance basis your risk appetite.
The interesting thing about ULIP insurance plans is that you're not locked into one wealth growth strategy forever. If the market starts looking good, you can switch from your existing funds into equity funds, as available under the product. If the markets are volatile, you can switch to debt funds. Most ULIP plans give you several pre-determined free fund switches each year, which lets you have control over your fund allocation.
But here's what you actually need to know about the ULIP plans. When you get a ULIP plan, the premium you pay gets split two ways. Part goes toward life insurance coverage (so your family is protected), and part goes into funds available in the product. You can choose equity funds, typically high risk, if you want growth or choose debt funds, if you want stability, or choose a mix of both these funds in case if you want to balance basis your risk appetite.
The interesting thing about ULIP insurance plans is that you're not locked into one wealth growth strategy forever. If the market starts looking good, you can switch from your existing funds into equity funds, as available under the product. If the markets are volatile, you can switch to debt funds. Most ULIP plans give you several pre-determined free fund switches each year, which lets you have control over your fund allocation.
Assessing Fund Performance and Switching Options
Now, if you were actually purchasing an ULIP insurance today, you'd want to see how the funds available in ULIP products have performed over last 3 - 5 years, not just their year on record.
You'd also want the ULIP plan that offer various types of fund options, helping you canvas your fund allocation based on various risk appetite i.e. different funds having exposure in equity, debt, money market, balanced options. Because your life goals at age of 25 years are very different from your goals at age 45. The ULIP insurance plan should be flexible enough to grow with you.
Take SUD Life's offerings, for instance, SUD Life e-Wealth Royale. This product provides 12 distinct fund options with zero premium allocation charges, making it cost-effective from day one. If you prefer higher protection, SUD Life STAR TULIP offers life cover option of up to 30 times your annual premium along with 12 different fund choices and 12 free switches per year.
You'd also want the ULIP plan that offer various types of fund options, helping you canvas your fund allocation based on various risk appetite i.e. different funds having exposure in equity, debt, money market, balanced options. Because your life goals at age of 25 years are very different from your goals at age 45. The ULIP insurance plan should be flexible enough to grow with you.
Take SUD Life's offerings, for instance, SUD Life e-Wealth Royale. This product provides 12 distinct fund options with zero premium allocation charges, making it cost-effective from day one. If you prefer higher protection, SUD Life STAR TULIP offers life cover option of up to 30 times your annual premium along with 12 different fund choices and 12 free switches per year.
Understanding What You're Actually Paying For
Here's where ULIP insurance can get a bit complex for you. The charges. There is premium allocation charge (basically a processing fee), fund management charges (for professional fund management), policy administration charges (for maintaining your account), and mortality charges (for the life insurance part).
You'd want the ULIP plans that are upfront about all these costs. Some plans have zero premium allocation charges, others might charge upfront but return the money after 10 years, depending on one insurer to another. What matters is the total impact on your returns over time, not any single fee.
While most of the charges attracted a percentage of GST earlier, the part is that post 22nd September 2025, all ULIP insurance plans now attract 0% GST on charges. This allows your premium to get more room to spread across your policy.
There’s a 5-year lock-in period here that actually helps you here even if you think otherwise. It prevents you from making emotional decisions and making any withdrawals when markets get choppy. And since ULIP insurance is meant for your long-term goals anyway, the lock-in keeps you focused on the bigger picture.
You'd want the ULIP plans that are upfront about all these costs. Some plans have zero premium allocation charges, others might charge upfront but return the money after 10 years, depending on one insurer to another. What matters is the total impact on your returns over time, not any single fee.
While most of the charges attracted a percentage of GST earlier, the part is that post 22nd September 2025, all ULIP insurance plans now attract 0% GST on charges. This allows your premium to get more room to spread across your policy.
There’s a 5-year lock-in period here that actually helps you here even if you think otherwise. It prevents you from making emotional decisions and making any withdrawals when markets get choppy. And since ULIP insurance is meant for your long-term goals anyway, the lock-in keeps you focused on the bigger picture.
Making Your Decision
So which ULIP insurance is for you in 2026? There's no one-size-fits-all solution, to be honest. The ULIP plans for you depend on your specific situation, goals, and comfort level with market fluctuations.
If you're young and have time on your side, ULIP insurance with more equity exposure might work for you. If you're closer to retirement or need the money in the next 10 years, you'd probably prefer the ULIP plans with more conservative fund options.
The tax benefits are for you, too. The premiums you pay towards your ULIP insurance qualify under Section 80C deductions (up to ₹1.5 lakh) under the Income Tax Act of 1961, and maturity proceeds are tax-exempt under Section 10(10D) of the same act. Plus, the disciplined saving that comes with ULIP insurance can be valuable if you might otherwise spend the money.
But here's the thing about ULIP plans. They're not just wealth building products with some life cover thrown in, or insurance products with investment features. They're designed to do both jobs reasonably well over the long term for you. The key is picking ULIP insurance that matches your actual needs, not what someone thinks your needs should be.
Bottom line, choose the ULIP plan like you'd choose any long-term financial commitment. Based on transparency, reasonable costs, flexibility to adapt as your life changes, and confidence that the company will be there when you need them.
If you're young and have time on your side, ULIP insurance with more equity exposure might work for you. If you're closer to retirement or need the money in the next 10 years, you'd probably prefer the ULIP plans with more conservative fund options.
The tax benefits are for you, too. The premiums you pay towards your ULIP insurance qualify under Section 80C deductions (up to ₹1.5 lakh) under the Income Tax Act of 1961, and maturity proceeds are tax-exempt under Section 10(10D) of the same act. Plus, the disciplined saving that comes with ULIP insurance can be valuable if you might otherwise spend the money.
But here's the thing about ULIP plans. They're not just wealth building products with some life cover thrown in, or insurance products with investment features. They're designed to do both jobs reasonably well over the long term for you. The key is picking ULIP insurance that matches your actual needs, not what someone thinks your needs should be.
Bottom line, choose the ULIP plan like you'd choose any long-term financial commitment. Based on transparency, reasonable costs, flexibility to adapt as your life changes, and confidence that the company will be there when you need them.
Frequently Asked Questions
1. What are the benefits of ULIP plans?
ULIP insurance offers dual benefits of life protection plus wealth creation. You get tax deductions under Section 80C (up to ₹1.5 lakh) and tax-exempted maturity under Section 10(10D) of the Income Tax Act^. The ULIP plans provide flexibility to switch between equity, debt, and balanced funds. After 5 years, partial withdrawals are allowed for emergencies.
2. How do I select the ULIP for my needs?
Define your goal and timeline first. For long-term goals (15+ years), choose equity-heavy ULIP insurance. For shorter goals (5-10 years), prefer debt or balanced funds. Compare total charges, not individual fees. Ensure adequate life coverage for your family. The ULIP plans offer multiple fund choices and easy online management.
3. Can I withdraw money from ULIP before maturity?
ULIP products have 5-year lock-in period during which no are withdrawals allowed. After end of 5 years, you can take partial withdrawals from your policy. Please read your policy terms and conditions for more details. However, the ULIP plans work optimal when you stay invested for the long-term considering the power of compounding. Frequent withdrawals can hurt your wealth creation goals.
4. What charges should I expect in ULIP plans?
It differs from product to product. However, most ULIP plans has following types of charges: Premium Allocation Charge, Fund Management Charge, , Policy Administration Charge, Mortality Charge Please read the sales brochure of the respective ULIP products carefully to know more about the charges.
ULIP insurance offers dual benefits of life protection plus wealth creation. You get tax deductions under Section 80C (up to ₹1.5 lakh) and tax-exempted maturity under Section 10(10D) of the Income Tax Act^. The ULIP plans provide flexibility to switch between equity, debt, and balanced funds. After 5 years, partial withdrawals are allowed for emergencies.
2. How do I select the ULIP for my needs?
Define your goal and timeline first. For long-term goals (15+ years), choose equity-heavy ULIP insurance. For shorter goals (5-10 years), prefer debt or balanced funds. Compare total charges, not individual fees. Ensure adequate life coverage for your family. The ULIP plans offer multiple fund choices and easy online management.
3. Can I withdraw money from ULIP before maturity?
ULIP products have 5-year lock-in period during which no are withdrawals allowed. After end of 5 years, you can take partial withdrawals from your policy. Please read your policy terms and conditions for more details. However, the ULIP plans work optimal when you stay invested for the long-term considering the power of compounding. Frequent withdrawals can hurt your wealth creation goals.
4. What charges should I expect in ULIP plans?
It differs from product to product. However, most ULIP plans has following types of charges: Premium Allocation Charge, Fund Management Charge, , Policy Administration Charge, Mortality Charge Please read the sales brochure of the respective ULIP products carefully to know more about the charges.
Disclaimer
Unit Linked Life Insurance products are different from the traditional insurance products and are subject to the risk factor. The premium paid in Unit Linked Life Insurance Policies are subject to Investment Risks associated with Capital Markets and NAVs of units may go up or down based on the performance of the fund and factors influencing the Capital Market and the insured is responsible for his/her decisions. Please know the associated risks and the applicable charges, from your insurance agent or the intermediary or policy document issued by the insurance company. The various funds offered under this product are the names of the funds and do not in any indicate the quality of these, their prospects and returns. The past performances of the funds are not indicative of the future performance of any of the funds available under this Policy. There are no guaranteed or assured returns in this policy, except under Discontinued Policies Fund where the minimum guaranteed interest will be as prescribed by the IRDAI from time to time. The policyholder can withdraw the invested amount only after the completion of five plan years.
SUD Life STAR TULIP | UIN: 142L091V01 | A Unit–Linked Non-Participating Individual Life Insurance Plan
SUD Life e-Wealth Royale | UIN: 142L082V03 | A Unit–Linked Non-Participating Individual Life Insurance Plan
ULIP - SUD-OTH-11-25-4349|Star Union Dai-ichi Life Insurance Company Limited | IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: Unit no. 1101, 11th Floor, Building No. 1, Raheja Mindspace Juinagar, Plot No. GEN 2/1/E, TTC Industrial Area, MIDC Juinagar, Navi Mumbai – 400706 | 1800 266 8833 (Toll Free) | Timing: 9:00 am - 7:00 pm (Mon - Sat) | Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. Tax benefits are as per prevailing tax laws and subject to change from time to time. Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
SUD Life STAR TULIP | UIN: 142L091V01 | A Unit–Linked Non-Participating Individual Life Insurance Plan
SUD Life e-Wealth Royale | UIN: 142L082V03 | A Unit–Linked Non-Participating Individual Life Insurance Plan
ULIP - SUD-OTH-11-25-4349|Star Union Dai-ichi Life Insurance Company Limited | IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: Unit no. 1101, 11th Floor, Building No. 1, Raheja Mindspace Juinagar, Plot No. GEN 2/1/E, TTC Industrial Area, MIDC Juinagar, Navi Mumbai – 400706 | 1800 266 8833 (Toll Free) | Timing: 9:00 am - 7:00 pm (Mon - Sat) | Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. Tax benefits are as per prevailing tax laws and subject to change from time to time. Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
