ULIP plan in India |Canara HSBC OBC Life Insurance
ULIP Insurance Plans
Canara HSBC Oriental Bank of Commerce Life Insurance offers online ULIP insurance plans which helps you ensure a secure future for your family and fulfil your life goals, without compromising on either.
ULIP stands for Unit Linked Insurance Plan. This insurance cum investment plan offers you the dual benefit of creating wealth along with life cover. This means you not just generate money, but also get a comprehensive life insurance. Thus, one must invest in such an investment plan and get the maximum benefits that it has in store for you.
How does ULIP investments work?
Like any other insurance, you need to pay a premium for unit linked insurance plan. In ULIPs, the insurance company deducts an amount of your premium towards life cover and the rest is invested in a number of qualified funds. Afterwards, you get returns based on the performance of funds you opted for. There are several investment options such as debt, equities, hybrid funds, etc., for you to choose from.
ULIP gives you the flexibility to switch to a different investment option. This can be useful if you do not have fixed financial goals and you want to shift from one fund to another.
It offers transparency. With ULIPs, you don't have to worry about the hidden changes or fees. All charges such as management of funds, policy administration, etc are disclosed upfront before you to buy the product.
ULIPs are efficient tax saving instruments. The premium that you pay towards the policy is exempt to deduction under section 80C of the Income Tax Act.
It is perfect for long term investment objectives. Before investing in ULIP plan, it is advisable to make a list of your long term financial goals that you want to fulfill through investment. Goals such as funding for your kid's higher education, purchasing a house, children marriage, etc.
How to Choose Best ULIP?
In order to choose the right ULIP, you need to keep these following factors in mind
1. Claim Settlement Ratio
This Percentage will give you a fair idea how many claims have been paid out by the insurance company. The higher the ratio, the better. Canara HSBC Life OBC has a claim settlement ratio of 97.18%.
2. Performance of ULIP Funds
Before investing in ULIPs, you must check the past performance of funds. You can check the performance of funds for a period of 5 years to get an idea of how they are performing.
3.Know your risk appetite
You must be aware of your risk appetite. Knowing your risks will help you choose the type of fund you are opting for.
4.Investment Strategies
Many ULIPs offer investment strategies such as Flexibility between switching funds, multiple premium payments options, and lifecycle based investing. Look for ULIPs that offer the strategies most suited to your goals.
5.Research about Solvency ratio of the insurance company
Before buying the plan, you must do some research work to know whether the insurance company is able to fulfill its claim in future. Higher the Solvency ratio better the company's ability to fulfill its liability .This will help you understand the company's capabilities to meet the need of customers.
Things keep in Mind before Investing in ULIP?
Risk appetite: You must know your risk appetite before investing in ULIP. This plan comes with wide range of funds to select from basis your needs and risk appetite. Those who are reluctant to take risks can invest most of their investment in debt funds while those who like to take risks can go for equities.
Charges in your ULIP: This investment cum insurance plan comes with a set of charges. Thus, before purchasing the policy, it is important for you to understand the following charges-
• Mortality/Morbidity Charge
• Policy Administration charge
• Fund Management charge
• Premium Allocation charge
Flexibility:ULIPs offer you the flexibility to switch between the funds. While buying a ULIP investment, you must consider the cost of switch, ease of switch, and complimentary switches during the policy period.
Premium payment optionULIPs basically offer three types of payment options - single, limited, and regular. Therefore, compare and choose plan that you are comfortable with.
Useful Features of ULIP Plans
Flexible investment options: With ULIPs, you have the flexibility to select your fund as per your risk appetite. ULIPs come with a variety of funds to choose from. Investors with a low risk appetite can invest in debt funds while those with a high risk appetite can invest in equity funds.
Lock-in-period: ULIPs come with a lock-in-period of 5 years and offer good returns on investment over a long period of time.
Premium payment options: There are three ways of making payments - single, limited, and regular payment options. Single payment option is a one-time investment where you are required to pay the premium amount as lump sum at the inception of the policy.
Liquidity: ULIPs also allow you to do partial withdrawals when you need it after completion of lock-in period.
What are the Types of ULIP Plans Canara HSBC Oriental Bank of Commerce Offers?
Online ULIP Plan -INVEST 4G
Boost your savings with our new age ULIP i.e. Invest 4G ULIP available online. This is a perfect investment option for new age investors who want to achieve their long term financial goals. This zero commission investment product comes with loyalty additions and wealth boosters. In terms of returns, Invest 4G perform better than other investment options due to its minimum charge structure.
Invest 4G - ULIP Plan Key Benefits:-
1. Flexibility of switching and redirection between the fund options
2. Partial withdrawals
3. Option to choose between 7 different funds and 4 portfolio strategies
4. Loyalty Additions & Wealth Boosters
5. Return of Mortality Charge on Maturity
Offline Plans:-
Name of the Plan
Key Features
Titanium Plus Plan
(Savings cum protection plan)
Policy Term
Single pay - 5 years
Limited Pay & Regular Pay - 10 to 30 years
Premium Amount Details
Premium Payment Mode
Minimum
Maximum
Annual
Rs 2,00,000/- p.a.
No Limit
Monthly
Rs 25,000/- p.m.
Single
Rs 5,00,000/-
Premium Payment Term
Singe Pay: Single Premium
Limited Pay: 5/7/10/15 Years
Regular Pay: Equal to Policy Term
Policy Term
Maximum policy term is 80 years less entry age
Minimum policy term is 10 years
For regular/limited pay-Maximum policy term is limited to 35 years
For single pay-Maximum policy term is limited to 30 years
*Option to increase the Policy Term / accumulation period
Yes, ULIPs do offer tax benefits. In fact, it is one of the best tax saving instruments. As per Income Tax Act, 1961, you can save tax on your hard earned money by investing in unit linked insurance plan. The premium paid towards ULIP is allowed a tax deduction of up to 1.5 lacs under section 80C of the Income Tax Act.
Why should I invest in ULIP?
If you want to enjoy the triple benefits of life cover, good returns, and tax savings, then you must invest in ULIP. It's a great investment plan as compared to other investment options. In ULIP, the premium paid towards the policy is divided in two sections-Insurance and investment. Therefore, an individual investing in such plan will not just fetch good returns but will get life protection cover as well.
How safe it to invest in ULIP?
ULIP is one of the best market-linked investment options. It offers you the choice to enter capital market for a longer period of time. This savings cum protection plan is a mix of liquidity and security which makes it relatively safer, flexible, and fruitful investment option.
How the ULIP Insurance Plan from Canara HSBC Oriental Bank of Commerce Life helps you?
Knowing the multiple benefits ULIP offers, it is recommended to choose the best plan depending your age and objectives. Canara HSBC Oriental Bank of Commerce offers different ULIPs that are just perfect for you and will help you meet your financial goals. We offer a range of ULIP plans for you to enjoy the benefits of investment and life insurance protection at the same time.
In order to understand ULIP NAV, you first need to understand how ULIPs work. In ULIPs, a portion of premium from different investors is accumulated to create one investment corpus.
This money is invested in several different market instruments. So to divide the returns properly among all the investors, the fund manager divides the net asset value in to small units with a specific face value. NAV is the per market share value of a fund. To better understand the definition of NAV, take a look at the formula below -
Net Asset Value = [Assets-(Liabilities + Expenses)] / Outstanding Units
It's not risky to invest in ULIP if you chose a safer path. Risk factor in ULIPs depends on the investment option you choose. If you are not okay with sharp movements, then choosing a low risk investment is a better idea. For people with high risk appetite, it's good to choose equity funds while risk-averse investors can go for debt funds.
You can opt for settlement option if you want to take your fund value in periodic installments. With the settlement option, you can get your maturity amount in installment as per the frequency chosen by you over a maximum period of 5 years. You can choose complete withdrawal of fund value at any point of time. Although, you will not get any life cover during this period.
ULIPs are life insurance products that provide paths to invest. And just like other investment option, there's no guaranteed investment return in a ULIP. Although, if you like taking risks and want to earn more returns on your investment, then opt for equity funds.
At the time of maturity of ULIP policy, you will get the fund value on your prevailing NAV. Fund value is the number of units of policy multiplied by NAV (net asset value).
Value of the fund = Total units of policy x NAV (Net Asset Value)
Well, discontinuing your premium payment will disrupt your savings as well as financial goals. In such case, you can approach your insurance company and ask for the revival of discontinued policy within the stipulated timelines. Also, you will have to pay all the unpaid premiums.
ULIP plan is a combination of investment and insurance. Thus, one must hold this plan for a duration of at least 10 years so as to get investment benefits out of it. As an early exit will have its own consequences. ULIPs have a lock-in-period of 5 years. Thus, you may surrender your policy before the completion of 5 years, but you will be paid only after the end of 5 years.
