Insurance contracts that invest in one or more underlying assets, such as a mutual fund.Unlike mutual funds, segregated funds provide a guarantee to protect part of the money you invest (75% to 100%).
Even if the underlying fund loses money, you are guaranteed to get back some or all of your principal investment.
But you have to hold your investment for a certain length of time (usually 10 years) to benefit from the guarantee.And you pay an additional fee for this insurance protection.
Need For Flexibility
At different life stages, individuals have very different needs, and varying appetite for risk. An investment product must be adaptable enough to cater to these varying requirements. Traditional insurance plans do not offer this flexibility. However, Ulips can be adapted to meet changing needs.
Flexibility in a long-term plan is very important as individuals’ savings needs and risk profile changes over time. Take a look at how needs change depending on the investor’s stage of life.
A young, single individual has the ability to try and maximise long-term returns, so makes a higher contribution to equity.
» At age 30-45, there is a need to start saving for the family. Depending on risk tolerance, he will need equity and balanced investment options.
» At age 45-55, risk tolerance could reduce, so balanced and debt funds may be most suitable.
» From age 55, there is a need to protect the investments made. It also becomes important for investments to earn a steady income. Debt-oriented plans are good choices at this stage.
Easy asset allocation
Ulips, compared with traditional life insurance plans, can provide risk cover across asset classes, providing you with a choice of investments suited to life-stage requirements and risk profile. There are even options that offer capital guarantee, which is what risk-averse investors seek.
With Ulips, you can define your own asset allocation mix and modify your exposure as your needs change. Switching funds across asset classes is permitted a few times a year. This allows for an ability to protect gains with changing risk-appetite and needs.
You can also use Ulips as protection from inflation. Your premium payments and sum assured can be inflation index linked, providing a buffer against the loss in the “real” value of the planned future corpus due to inflation.
Ulips create a disciplined approach to savings through regular premium payments. These plans have clearly defined charge structures and illustrations with fixed return projections. Daily declaration of the net asset value helps you keep track of the policy’s value. Periodic portfolio disclosure also increases transparency.
Registered Retirement Savings Plan
Registered Retirement Savings Plan
Term life insurance provides temporary protection for temporary needs. It also has some flexibility, so you can adjust your insurance as your needs change Term life insurance offers protection for your loved ones for a specified period of time—usually from one to 20 years.
Registered Education Savings Plans
You start saving early in your child’s RESP and take advantage of generous government grants.
Your regular contributions and grants generate interest. Your RESP grows tax free.
Tax-Free Savings Account
A tax-free savings account (TFSA) helps you grow your savings tax-free.
It’s the perfect tool to save for a project like a trip, a house purchase or a new car.
Guaranteed investment certificate
A guaranteed investment certificate is a Canadian investment that offers a guaranteed rate of return over a fixed period of time, most commonly issued by trust companies or banks. Due to its low risk profile.
Annuities (Guaranteed Income)
Annuities are ideal if you would like to convert a portion of your savings into a fixed and guaranteed income that provides you with regular payments. There are two types of annuities: life and certain. The FORLIFE Series of the IAG Savings and Retirement Plan also offers a guaranteed lifetime income.
Life insurance is an important part of a complete financial portfolio. Learning basic life insurance facts will help you make an informed decision about the type and the amount of life insurance that you need.When you buy life insurance, you enter into a contract with an insurance company that promises to provide your beneficiaries with a certain amount of money upon your death
Frequently Asked Questions
What is the meaning of insurance?
Why do I need Insurance?
Why should one cover oneself immediately ?
How to Choose the Best Term Plan?
Claim settlement record of a life insurance company indicates the ultimate moment of truth for the customer. Claim settlement record can be assessed through a percent number (Claim Settlement Ratio) released by IRDAI (Insurance Regulatory and Development Authority India) every year.
How much life cover do I need?
If budget is a problem, you could go for monthly premium payment option over a yearly commitment. However, it is important to have a sufficient life cover so that your family’s financial security is not compromised.