At the back of every person's mind is the fear that their loved ones will be left unprotected in the future. This fear can drive people to work extremely hard and explore every avenue to safeguard their loved ones. It even gives some people sleepless nights, especially if they are already under financial stress. But they soon find that their hard work yields only minimal results: there is never enough money to pay major expenses!

Soon, it dawns on you that just your income cannot suffice. You need to explore an option to create wealth for the future. At this juncture, you realize that you must put your faith in Unit Linked Insurance Plans (ULIPs).

The benefits of ULIPs

Of the many reasons to invest in ULIP plans, five stand out more than the rest. They are:

• Good returns:After the premium of the unit linked plan is paid by the policy holder, the insurance company allots units of high grade shares. The higher the investment, the better is the quality of the allotted units. Since these are high grade equities, the returns on them are guaranteed. Thus, ULIP plans offer good capital appreciation.


• Inputs from experienced fund managers:t is not necessary for the policy holders to monitor the fund on a daily basis, or to even have a working knowledge of the markets. Simply buy ULIP online, and a fund manager handles the portfolio and advises on the best investment practices. Hence, the success of the ULIP plan is guaranteed, since an experienced manager is invested in it.


• Freedom to influence returns: The best part about investing in ULIPs is that they offer policy holders the chance to reorient the portfolio. If you are not happy with the fund's performance, you can switch to better performing units at a later date. This directly influences the outcome of the ULIP plan and thus, the returns accrued on it.


• Creates a sizeable fund of money: The ULIPs in India are creating wealth for scores of Indians all over the country. When it is structured well and invested in regularly, it grows into a large sum of money over a period of time.


• Tax benefits:All ULIP plans in India are liable for tax deduction. Tax benefits are extended under Sec 80C of the Income Tax Act, 1961. Even the sum assured of the plan is tax deductible. This adds to the ULIP's overall profitability.