ULIP

A ULIP (Unit Linked Insurance Plan) is a product that combines life cover with market-linked investment: part of each premium buys insurance and the rest buys units in funds you choose. It carries a five-year lock-in, and the investment portion moves with the market, so the value is not assured. Because two products sit inside one wrapper, compare the charges — premium allocation, policy administration, fund management and mortality — against buying term insurance and a mutual fund separately. Judge it on total cost and on what you actually need, through IRDAI-licensed advisors.