Know about your ULIP

Dear Readers,

             Now a days agents are promoting more ulip's than traditional insurance plans, but still there are some terms which are not clear to the end customers, so i would like to present hear some details about the ULIP which may help the readers to understand about there ULIPS. 

First lets look into the charges and term involved in the ULIPS.

Most of the insurers try to be transparent about these changes in the brochures & in policy documents, most of the policyholders don't understand what they  are being mad to pay for. There are seven common changes that come with a ULIP:

• Premium Allocation Charges 
• Fund Management Charges 
• Policy Administration Charges
• Mortality Charges
• Fund Switch Charges 
• Surrender Changes
• Service Tax Deduction

Let's see these in details 

Premium Allocation Charges: The entry load charged on issuing the units under the policy. This normally includes initial and renewal expenses, apart from commission expenses.

Fund Management Charges : This is the free levied for management of the fund(s) and is deducted before arriving at the net asset value (NAV).

Policy Administration Charges ; This is the fee for administration of the plan. It is levied by the cancelling units worth the amount every year. This could be flat throughout the policy term or vary.

Mortality Charges : This is the cost of the insurance cover offered in the policy. Mortality Charges depends on a number of factors such as age, amount of coverage and health of the policyholder.

Fund Switch Charges : Most insurance companies offer four free fund switches in a year. The subsequent switches are charged.

Surrender Charges : A Surrender charge may be deducted for premature partial or full encashment of units wherever applicable, as mentioned in the policy document.

Service Tax Deduction : Before allotment of units, the applicable service tax is deducted from the risk portion of the premium. Some companies absorb this cost.

For more information  please contact :

Venkataramana.D

Email id : sriram.adviser@gmail.com

Phone No: +1-408-250-9952

This information is take form Money Today