Last year I had started a unit-linked insurance plan (Ulip). Later, I realised it was not a good scheme as there were too many charges involved. As it is under section 80C of the income-tax Act, if I stop this I will have to pay the tax and there will be surrender charges. What do you suggest? Shall I close it or just be with it? The premium payment term is 5 years and the policy term is 10 years. I have paid only one premium of Rs80,000. I’m not too keen to take insurance right now. I am 27 years old. I have no commitments. My husband is also working, so I can be aggressive on savings.
—Pragya Das
Ulips are financial products that provide a combination of insurance and investments to investors. That is, part of the invested money is used to provide an insurance coverage to the investor (typically the coverage is about 10 times the premium amount), and the rest of the money is invested to provide a return.
