Skip to main content

ULIP Statement - Understanding The Jargon

Reading any statement – whether of a bank, a mutual fund or a unit-linked insurance plan (Ulip) – can be a nightmare.

In a Ulip statement, even a single-premium policy will show several transactions during the full tenure, since the number of units is not fixed and charges are deducted from the units. Switches further complicate matters as purchase price calculations will change again

Most insurance companies follow different formats and use diverse terms in their annual statements. A few sections, common to all, will be a summary of the policy, a transaction report on the fund's growth and a section detailing the various charges. All statements include basic information regarding the policy.

Transaction statement

The 'transaction activity report' is an important section, as it traces month-onmonth activity in the fund. Other columns show monthly policy charges deducted from the premium, the unit's price or net asset value (NAV), the number of units bought at that price and the fund value. The price per unit (NAV) is proportional to the number of units held on the transaction date.

Monthly policy charges

This section gives an account of month-on-month charges. The columns describe transaction dates and the various charges levied. Some of them will be:

Mortality charge or life-risk charge:

This is the cost to insure the policyholder. The charge depends on several factors like age, amount of coverage, state of health, and so on. However, monthly mortality charges may vary, depending on the number of units held on the transaction date.

Policy administrative charges:

These are the charges for administering the plan. This could be a flat charge throughout the term, or may vary at a pre-determined rate.

Tax duties, levies and total charges:

They are the other charges.

If the policyholder takes such extra benefits as an 'extra health benefit' (adding a health policy to the existing policy), the option to switched funds or for partial withdrawals, charges applicable to these facilities will be mentioned in the statement.

A Ulip statement should typically have these parameters. Besides the usual – policy and fund name, client number, date of issuing the policy and date of birth of the policyholder – there will be some other critical information:

Premium: A regular mode means the premium is paid annually. A single premium indicates a one-time payment.

Sum assured: This is the risk cover for the policyholder, and is a function of the single premium in most cases.

Life assured: Of the policyholder. In case, the life assured is of a minor, the name would be stated under 'proposer'.

Contract status: 'In force' suggests a continuing policy. 'Paid up contract' means the premium is not being paid. If the policyholder stops paying the premium before the lockin period has expired, it will read as lapsed.

Term and plan maturity date: This indicates the period and the exact date the cover ends.

Next due date: The date on which the next premium is due.

'In a Ulip statement, even a single-premium policy will show several transactions during the full tenure, since the number of units is not fixed and charges are deducted from the units'

Popular posts from this blog

How much to invest in gold ?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) Let your motivation dictate the share of the yellow metal in your portfolio Enough has been said and written about gold as an investment option. The latest argument is that the craze for gold among Indian households is endangering our country's balance of payments. The policymakers are busy trying to find ways of discouraging investment in gold, but if households keep the common good in mind, they would be paying the market price for gas cylinders as they do for, say, their mobile phone bills. After all, private decisions are driven by private motives. So, how should a household look at gold from its own perspective? Gold is primarily acquired for its merit as a store of value. Even if the worst crisis hits a family, the gold that it holds could be put to use anywhere in th...

Save Tax With Mutual Funds

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300       Mutual funds are ideal as long term investment avenues for retail investors. To encourage investments in this avenue, the Government of India offers investors a spate of tax benefits thus ensuring maximum benefit from mutual funds held beyond a year. Sample some of the key benefits and refer to the table for a detailed list of tax rates for different types of schemes ·        Avail deductions under Sec 80C of the Income Tax Act by investing up to a maximum of Rs. 1 lakh in designated Equity Linked Savings Schemes (ELSS). Such investments have a compulsory lock in period of 3 years. ·        First time retail investors in equity with a gross total income of up to Rs. 12 lakh can invest up to Rs. 50,000 in specific MF schemes un...

LIC's JEEVAN SHIKHAR

  LIC's Jeevan Shikhar is a participating, non-linked, saving cum protection single premium plan wherein the risk cover is ten times of Tabular Single Premium. The proposer will have an option to choose the Maturity Sum Assured. The premium payable shall depend on the chosen amount of Maturity Sum Assured and age at entry of the life assured. This plan also takes care of liquidity need through its loan facility. The plan will be open for sale for a maximum period of 120 days from the date of launch. 1.   BENEFITS   : a) Death Benefit: On death during first five policy years: Before the date of commencement of risk   :   Refund of Single Premium without interest. Single Premium mentioned above shall not include any extra amount if charged under the policy due to underwriting decision and taxes. After the date of commencement of risk   : "Sum Assured on Death" equal to 10 times the tabular single premium shall be payable. On death after completion of five policy years but b...

Rajiv Gandhi Equity Savings Scheme (RGESS) set for launch this week

The finance ministry is set to notify the Rajiv Gandhi Equity Savings Scheme ( RGESS ) this week.   Though Finance Minister PChidambaram had approved on September 21, the scheme announced in this year's Budget, and had said that the revenue department will notify the scheme and the Securities and Exchange Board of India ( Sebi ) would issue relevant circulars within two weeks, it is yet to become operational.   A senior finance ministry official said the revenue department was expected to notify the scheme any day now to attract retail investors to the equity segment.   He added that Sebi was not required to issue any circular for the operationalisation of the scheme and that after the issuance of the revenue department's notification, investors would be able to avail of the benefits of the scheme.   The official accepted that implementation of the scheme had been delayed due to the deliberations on inclusion of mutual funds ( MF ) in it.   ...

IDFC Nifty ETF

IDFC Mutual Fund has launched IDFC Nifty ETF . The fund seeks to provide returns tha, before expenses closely correspond to the total return of the underlying index, subject to tracking errors. The minimum investment is `5,000 and the NFO closes on 30 September. ------------------------------ ----------------- Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds Top 10 Tax Saver Mutual Funds to invest in India for 2016 Best 10 ELSS Mutual Funds in india for 2016 1. BNP Paribas Long Term Equity Fund 2. Axis Tax Saver Fund 3. Religare Tax Plan 4. DSP BlackRock Tax Saver Fund 5. Franklin India TaxShield 6. ICICI Prudential Long Term Equity Fund 7. IDFC Tax Advantage (ELSS) Fund 8. Birla Sun Life Tax Relief 96 9. Reliance Tax Saver (ELSS) Fund 10. Birla Sun Life Tax Plan Invest in Best Performing 2016 Tax Saver Mutual Funds Online Invest Online Download Application Forms For further information contact Prajna Capital on 94...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now