ULIPs can easily be customized to suit one’s needs & requirements. This is primarily due to range of features that ULIPS offer to the customer. Below mentioned are few charges applicable in case you have opted for an additional feature.
ULIP BENEFITS
APPLICABLE CHARGES
RIDERS: Riders are additional or supplementary benefits that are bought along with a main life insurance plan. Some of the commonly offered riders are critical illness benefit rider, accident & disability benefit rider, waiver of premium rider etc. For ex. In case you opt for a Critical illness rider you get additional protection from 9 critical illnesses.
Insurance companies levy rider charges in case you opt for riders.
SWITCH: ULIPs not only allow you to invest your money in fund options with various debt – equity exposure but also give you the option to switch between different funds. For example, you can switch money from a fund with 100% equity to a balanced portfolio, which has 60 per cent equity and 40 per cent debt.
Your insurance company may charge you a fee for switching your funds Generally only a limited number of fund switches are recommended in a year as a ULIP is a long-term investment tool therefore most of the companies allow a certain number of switches each year free of charge, with subsequent switches, subject to a minimal charge.
TOP UP: One of the unique feature offered by ULIP is Top Up where you can make additional contribution over & above the regular premium.
Insurance companies deduct a certain percentage from the top-up amount as charges. These charges are usually lower than the regular charges that are deducted from the annual premium.
SURRENDER: You may decide to surrender (premature partial or full encashment of units) your policy before the term of the plan.
Surrender charge may be deducted for premature partial or full encashment of units wherever applicable, as mentioned in the policy conditions. These charges are levied as a percentage of the fund value or as a percentage of the premium.
