One of the reasons many people invest in unit-linked insurance plans (ULIPs) is to earn maturity benefits. However, there are a few things to keep in mind in order to get maturity benefits with ULIPs.
In this article, we will explain things to keep in mind to receive the benefits of ULIPs.
A unit-linked insurance plan is a unique product that provides the benefits of insurance as well as investment. A part of the premium is invested for life cover and the remaining amount is invested in various investment instruments, such as equity funds, debt funds.
Thus, by investing in a ULIP, a person can provide his/her family with financial protection. Furthermore, he/she can earn returns that he/she will receive when the policy matures.
Here are the benefits of investing in a ULIP-
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It Can Provide Financial Protection
One of the benefits of a ULIP is that it can provide life cover to the policyholder. For instance, if the policyholder passes away during the tenure of the plan, then his/her family can receive a sum assured. This sum assured can be used to meet various expenses. Hence, a ULIP can protect a family from a financial burden. The beneficiaries of the policyholder can also meet future goals with the funds they receive.
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It Can Help in Building Funds
ULIPs are a great investment product if an investor plans to stay invested for a longer duration. This is because ULIPs can generate good returns if investments are done for a longer period of time. Hence, unit-linked insurance plans are a good option to achieve long-term goals.
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It Offers Tax Benefits
ULIPs also offer tax benefits. The policyholder can receive tax benefits under Section 80C for the premium paid to purchase a ULIP. Furthermore, under Section 10(10D), the maturity benefit is tax free.
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Things to Keep in Mind While Claiming Maturity Benefits from ULIPs
A ULIP provides the death benefit as well as maturity benefit. If the policyholder survives the term, then he/she can receive maturity benefit when the tenure ends. The insured person can receive the value of the fund when the policy matures. The policyholder will also receive bonus and loyalty benefits if there are any. The policyholder must submit a few important forms and documents while claiming the maturity benefits.
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Discharge Form
The insured person must fill the policy discharge form. This form will be available on the company’s website. The policyholder must provide information, such as the client ID, name, policy number, etc.
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Bank Details
As the maturity payment will be transferred into a bank account, the policyholder will have to submit the bank details.
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Documents
Along with the discharge form, the policyholder also needs to submit the original policy document.
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Submission
After filing the form and gathering the documents, the policyholder needs to submit them to the insurer before the due date. The policyholder can submit the documents at the insurance company’s branch or via post.
Keep the aforementioned points in mind while claiming maturity benefits from a ULIP.
