Unit linked insurance products
Unit linked insurance products or Ulips are hybrid financial products with the features of both investment and insurance.
With Ulips, a part of the premium paid by the unit-holder is allocated towards insurance and the rest is allocated towards investment. The part of the premium which is allocated towards the investment would then be invested in debt and equity or a combination of both according to the plan selected by the holder.
Once a popular instrument, Ulips have fallen out of favour because of their inability to make the most of their premise.