Please don't be emotional!!! When you play with your money, first thing necessary is that don't be emotional?
1) How you can say that "It is Hotch Potch".
2) You invest in ULIP scheme because you want both advantage i.e. insurance with investment, so some portion of your money will be used for your life risk cover.
3) to track down ULIP performance please go respective company website or other website who can give information about your ULIP position. For your convenience I give bajajallianz tracker web link.
When you go www.bajajallianzlife.co.in on footer side you can track your Policies NAV.
No it is not right to say that ULIP scheme is not good as tax saving instrument. When you say that Insurance+Investment is a non sense, it means you are confused when you trade or invest and in confusing mind never do anything, as it will harm you.
If you do full time investing work than you say that investing + Insurance is bad thing but when you are busy with your other professional life, It can give you 2-in-one advantage.
So Your financial consultant is doing their work well. For middle class and not big market participants insurance + investment is good and less time consuming.
1) How you can say that "It is Hotch Potch".
2) You invest in ULIP scheme because you want both advantage i.e. insurance with investment, so some portion of your money will be used for your life risk cover.
3) to track down ULIP performance please go respective company website or other website who can give information about your ULIP position. For your convenience I give bajajallianz tracker web link.
When you go www.bajajallianzlife.co.in on footer side you can track your Policies NAV.
No it is not right to say that ULIP scheme is not good as tax saving instrument. When you say that Insurance+Investment is a non sense, it means you are confused when you trade or invest and in confusing mind never do anything, as it will harm you.
If you do full time investing work than you say that investing + Insurance is bad thing but when you are busy with your other professional life, It can give you 2-in-one advantage.
So Your financial consultant is doing their work well. For middle class and not big market participants insurance + investment is good and less time consuming.
Re: which is best ULIP
Mutual funds is the 'safety of the principal' guaranteed, plus the added advantage of capital appreciation together with the income earned in the form of interest or dividend. Insurance is a provision against risk and it is a device with which man tries to protect himself from risk in life. The recent development in the financial innovation is Unit Link Insurance Policy (ULIP), which covers the concept of mutual fund and insurance.
A Unit Link Insurance Policy (ULIP) is one in which the customer is provided with a life insurance cover and the premium paid is invested in either debt or equity products or a combination of the two. In other words, it enables the buyer to secure some protection for his family in the event of his untimely death and at the same time provides him an opportunity to earn a return on his premium paid. In the event of the insured person's untimely death, his nominees would normally receive an amount that is the higher of the sum assured or the value of the units (investments). To put it simply, ULIP attempts to fulfill investment needs of an investor with protection/insurance needs of an insurance seeker. It saves the investor/insurance-seeker the hassles of managing and tracking a portfolio or products.
Various Schemes
However, there are some schemes in which the policyholder receives the sum assured plus the value of the investments. Various schemes have been tailored to suit different customer profiles and, in that sense, offer a great deal of choice. The advantage of ULIP is that since the investments are made for long periods, the chances of earning a decent return are high. Just as in the case of mutual funds, buyers who are risk averse can buy debt schemes while those who have an appetite for risk can opt for balanced or equity schemes.
In an Web Research I have soo many times come across the arguement that the charges in ULIPs are a lot more than MFs. I would like to share with you all some of my findings when I compared all the charges. (I have not compared mortality charges since MF's don't offer insurance) But Because of Mortality Charge, You have cover option..
Let us say, I wish to invest Rs.60,000 every year in a mutual fund of a leading fund house and also the same amount in ULIPS of HDFC, ICICI and BAJAJ ALLIANZ. The following are the charges I have considered.
MFS
Loading charges = 2.25%
Fund Management Charge = 2.50%
HDFC Unit Linked Endowment Plus
Loading charges = 60% first year, 1% from second year
Fund Management Charge = 0.80%
Admin charge = Rs.240 per annum
Loyalty bonus = 0.1% each year
Bajaj Allianz Unit Gain Plus
Loading charges = 24% first year, 3% from second year
Fund Management Charge = 1.75%
Admin charge = Rs.240 per annum
ICICI Lifetime Plus
Loading charges = 25% first year, 25% second year, 3% third and fourth year, 1% from fifth year
Fund Management Charge = 1.75%
Admin charge = Rs.720 per annum
If my investments grew by 10%, the following is what the returns would look like if I consider all the charges.
* The returns from HDFC Unit Linked Endowment Plus will beat MF returns by 9TH YEAR
* The returns from Bajaj Allianz Unit Gain Plus will beat MF returns by 11TH YEAR
* The returns from ICICI Prudential Lifetime Plus will beat MF returns by 12TH YEAR
CONCLUSION
On the long run(10+ years), ULIPs are infact cheaper than MFs in terms of charges. Hidden charges which are not quiet evident to the eye like fund management charge eat up a major portion of your returns in MFs making them more expensive than ULIPS over time.
So If you go with MF argument than go Direct Stock Market, Not MF. If you like MF than Go with ULIP.
For Deciding which Company offer best than All the Companies are same product with some minor modification. If you want good return with High Risk than Go with Bajaj Allianz and If you want Safety First but some low return than Go with LIC. Means It is upon you to decide.
Mutual funds is the 'safety of the principal' guaranteed, plus the added advantage of capital appreciation together with the income earned in the form of interest or dividend. Insurance is a provision against risk and it is a device with which man tries to protect himself from risk in life. The recent development in the financial innovation is Unit Link Insurance Policy (ULIP), which covers the concept of mutual fund and insurance.
A Unit Link Insurance Policy (ULIP) is one in which the customer is provided with a life insurance cover and the premium paid is invested in either debt or equity products or a combination of the two. In other words, it enables the buyer to secure some protection for his family in the event of his untimely death and at the same time provides him an opportunity to earn a return on his premium paid. In the event of the insured person's untimely death, his nominees would normally receive an amount that is the higher of the sum assured or the value of the units (investments). To put it simply, ULIP attempts to fulfill investment needs of an investor with protection/insurance needs of an insurance seeker. It saves the investor/insurance-seeker the hassles of managing and tracking a portfolio or products.
Various Schemes
However, there are some schemes in which the policyholder receives the sum assured plus the value of the investments. Various schemes have been tailored to suit different customer profiles and, in that sense, offer a great deal of choice. The advantage of ULIP is that since the investments are made for long periods, the chances of earning a decent return are high. Just as in the case of mutual funds, buyers who are risk averse can buy debt schemes while those who have an appetite for risk can opt for balanced or equity schemes.
In an Web Research I have soo many times come across the arguement that the charges in ULIPs are a lot more than MFs. I would like to share with you all some of my findings when I compared all the charges. (I have not compared mortality charges since MF's don't offer insurance) But Because of Mortality Charge, You have cover option..
Let us say, I wish to invest Rs.60,000 every year in a mutual fund of a leading fund house and also the same amount in ULIPS of HDFC, ICICI and BAJAJ ALLIANZ. The following are the charges I have considered.
MFS
Loading charges = 2.25%
Fund Management Charge = 2.50%
HDFC Unit Linked Endowment Plus
Loading charges = 60% first year, 1% from second year
Fund Management Charge = 0.80%
Admin charge = Rs.240 per annum
Loyalty bonus = 0.1% each year
Bajaj Allianz Unit Gain Plus
Loading charges = 24% first year, 3% from second year
Fund Management Charge = 1.75%
Admin charge = Rs.240 per annum
ICICI Lifetime Plus
Loading charges = 25% first year, 25% second year, 3% third and fourth year, 1% from fifth year
Fund Management Charge = 1.75%
Admin charge = Rs.720 per annum
If my investments grew by 10%, the following is what the returns would look like if I consider all the charges.
* The returns from HDFC Unit Linked Endowment Plus will beat MF returns by 9TH YEAR
* The returns from Bajaj Allianz Unit Gain Plus will beat MF returns by 11TH YEAR
* The returns from ICICI Prudential Lifetime Plus will beat MF returns by 12TH YEAR
CONCLUSION
On the long run(10+ years), ULIPs are infact cheaper than MFs in terms of charges. Hidden charges which are not quiet evident to the eye like fund management charge eat up a major portion of your returns in MFs making them more expensive than ULIPS over time.
So If you go with MF argument than go Direct Stock Market, Not MF. If you like MF than Go with ULIP.
For Deciding which Company offer best than All the Companies are same product with some minor modification. If you want good return with High Risk than Go with Bajaj Allianz and If you want Safety First but some low return than Go with LIC. Means It is upon you to decide.
Re: which is best ULIP
That depends on the time horizon you are planning to stay invested.
I would personally prefer to take a Term cover on my life and invest the remaining premium in some good performing MFs.
But if you look at the long term horizon, ULIP's may score over MFs as the Fund managment charges are quite low 0.8% per annumm (HDFC) as compared to around 1.5-2.5% charged by MFs. Also you have to pay entry load of 2.25 % while purchasing MFs while in ULIPs after initial 2 years this comes down to 1%. So if you plan to stay invested for long term , say around over 15 years , ULIP is not that bad choice either.
That depends on the time horizon you are planning to stay invested.
I would personally prefer to take a Term cover on my life and invest the remaining premium in some good performing MFs.
But if you look at the long term horizon, ULIP's may score over MFs as the Fund managment charges are quite low 0.8% per annumm (HDFC) as compared to around 1.5-2.5% charged by MFs. Also you have to pay entry load of 2.25 % while purchasing MFs while in ULIPs after initial 2 years this comes down to 1%. So if you plan to stay invested for long term , say around over 15 years , ULIP is not that bad choice either.
Re: which is best ULIP
Hi All,
I am parially convinced that ULIPs are not better options at least in comparison of a combination of a TERM PLAN & ELSS(or MUTUAL FUND), but the small analysis I did shows smthing else:
See suppose u are going for Bajaj Allianz.
U can take the risk coverage of from 5 times upto 125 times of the premium u are willing to pay(correct me if I am wrong).
so suppose u are willing to pay Rs.15K per annum, & for a higher coverage of 15 Lakhs (100 times of the premium).
so here u end up paying 45K for the coverage of 15Lakhs in ULIP.
I am not discussing the equity aspect of the ULIP, which I suppose is an additional benefit.
Now see Term Plan:
for the same coverage of 15Lakhs for up to the age 60 Years, your premium will be 4.5K (300 per lakhs) per annum approximately(I am assuming that for my age of 23 years).
So for 37 years(60- current age 23), u end up in paying 1.665 Lakhs in Term Plan
without any hope of return untill God calls you.
Now Lets talk about return on ULIP:
1st year invested amount would be 75%approx. : 11250 approx.
2nd year invested amount would be 95%approx. : 14250 approx.
3nd year invested amount would be 95%approx. : 14250 approx.
so total invested money comes upto 40K approx.
I didn't take Admin charges in account ....
so in even if in more then worst condition ULIP consumes all your money in admin charges in 37 years, you are in benefit.
Thats my rough analysis with few flaws.
so would like to invite the views of other members also.
Thanks,
Manish Jain
Hi All,
I am parially convinced that ULIPs are not better options at least in comparison of a combination of a TERM PLAN & ELSS(or MUTUAL FUND), but the small analysis I did shows smthing else:
See suppose u are going for Bajaj Allianz.
U can take the risk coverage of from 5 times upto 125 times of the premium u are willing to pay(correct me if I am wrong).
so suppose u are willing to pay Rs.15K per annum, & for a higher coverage of 15 Lakhs (100 times of the premium).
so here u end up paying 45K for the coverage of 15Lakhs in ULIP.
I am not discussing the equity aspect of the ULIP, which I suppose is an additional benefit.
Now see Term Plan:
for the same coverage of 15Lakhs for up to the age 60 Years, your premium will be 4.5K (300 per lakhs) per annum approximately(I am assuming that for my age of 23 years).
So for 37 years(60- current age 23), u end up in paying 1.665 Lakhs in Term Plan
without any hope of return untill God calls you.
Now Lets talk about return on ULIP:
1st year invested amount would be 75%approx. : 11250 approx.
2nd year invested amount would be 95%approx. : 14250 approx.
3nd year invested amount would be 95%approx. : 14250 approx.
so total invested money comes upto 40K approx.
I didn't take Admin charges in account ....
so in even if in more then worst condition ULIP consumes all your money in admin charges in 37 years, you are in benefit.
Thats my rough analysis with few flaws.
so would like to invite the views of other members also.
Thanks,
Manish Jain
Though we can't point a company as best , but given the low AMC charges , my personal preference would be HDFC. It offers various schemes for different purpose. Please refer http://www.hdfcinsurance.com for more details.
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