What are the Different Types of Investment Funds under ULIP?

Different Types of ULIP Investment Funds in India

Characteristics of Different Types of ULIP Funds

Below are the characteristics of different fund types in ULIP:

Fund Type Risk Parameter Return on Investment Fund Potential and Volatility Based on Market
Equity Funds High High Fund Potential Range: 20.84% to 34.23%
Volatility: High
Debt Funds Medium to low Low Fund Potential Range: 8.11% to 14.09%
Volatility: High
Balanced Funds Medium Medium Fund Potential Range: 9.23% to 13.25%
Volatility: Medium
Growth Super Fund High High Fund Potential Range: 8.5% to 9.7%
Volatility: High
Growth Fund High High Fund Potential Range: 8.8% to 19.2%
Volatility: High
Conservative Fund Low Low Fund Potential Range: 8.06% to 11.07%
Volatility: Low
Liquid Funds Low Low Fund Potential Range: 4.78% to 6.95%
Volatility: Low
Bond Funds Medium Medium Fund Potential Range: 8.81% to 10.63%
Volatility: Medium

The lock-in period for ULIP is five years, irrespective of the fund type.

Now that you know the various types of funds in ULIP, you can select one as per your need. However, you must take into consideration the risk factors, returns on investment, fund potential and volatility of the investment fund before finalising your choice.

FAQs About Types of Funds Under ULIPs:

Do I get a fund switch option in ULIP? up-arrow

Yes, you can switch your funds from equity funds to debt funds. However, you must note that you will get this option only if you have selected a Fixed Portfolio Strategy for your investments.

What do you mean by a balanced fund in ULIP? up-arrow

In ULIPs, a balanced fund acts as a combination of equity and debt funds wherein the money gets divided in a pre-determined proportion between these two funds.

What is the ideal time to invest in ULIPs? up-arrow

According to experts, in the best time for you to invest in ULIPs is when you are having a stable source of income. In addition, with the increase of your income, you can enhance the capital allocation and gain tax benefits.

What is the disadvantage of ULIP? up-arrow

When it comes to ULIPs, they come with a minimum lock-in period of 5 years. This mean you are not able to withdraw your investments till this period is over.