Topic Details (Notes format)

Understanding ULIPs (Unit Linked Insurance Plans)

Subject: Static GK (General Knowledge)

Book: Indian Money Knowledge

ULIPs combine insurance coverage with equity or debt investments. A portion of the premium goes toward life insurance, while the rest invests in market-linked funds. While offering tax advantages under Section 80C, ULIPs carry market risk. Insurance charges and fund management fees can affect returns. Students or young professionals seeking dual benefits of insurance and investment may explore ULIPs, but comparing them against term insurance plus separate mutual funds is vital for clarity on cost-effectiveness.

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