Best ULIP Plans to Invest in India 2025

Have you ever wished for an investment plan that not only grows wealth but also ensures a family’s financial security? If so, this desire is shared by many.

Across India, people are seeking the perfect balance between achieving their financial goals and securing their loved ones. This is where Unit-Linked Insurance Plans (ULIPs) emerge as an excellent financial instrument, a dynamic solution that combines the power of investments with life insurance.

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This blog provides a comprehensive guide to everything one needs to know about the best ULIP plans in India, their unique advantages, and how they work. Are you ready to explore the best ULIP plans? Let’s begin!

What Are ULIPs, and How Do They Work?

A Unit-Linked Insurance Plan is a financial instrument that blends life insurance and market-linked investments into a single product. This hybrid offering allows policyholders to achieve dual objectives, protecting their family’s future while growing their wealth.

Key Components of a ULIP

• Life Insurance: Provides financial security to loved ones in the event of an untimely death of an investor.
• Market-Linked Investments: This feature enables investors to invest in a variety of funds, including equity, debt, or hybrid options, depending on their financial goals and risk appetite.

How do ULIPs Work?

Premium Allocation:

• Your premium is divided into two parts: one portion is used for life insurance coverage, and the other is invested in your chosen funds.
• After deducting charges such as fund management and policy administration fees, the remaining premium is allocated to the selected funds.

Fund Choices:

ULIPs offer three types of funds:

• Equity Funds: High-risk, high-reward investments suitable for aggressive investors.
• Debt Funds: Stable, low-risk options ideal for conservative investors.
• Balanced Funds: A perfect blend of equity and debt that offers moderate risk and returns.

Flexibility:

• One of the best features of ULIPs is that these instruments allow investors to switch between funds depending on market conditions or life-stage requirements.
• These fund switches are tax-free, giving you the flexibility to maximize returns without incurring additional costs.

Wealth Creation:

• Over the long term, the invested portion of your premium grows, creating a substantial corpus at maturity.
• This wealth-building capability makes ULIPs an ideal solution for financial planning.
• With their ability to combine protection with market-linked growth, ULIPs stand out as a useful instrument for securing your financial future.

How to Choose the Top ULIP Plan?

Selecting the best ULIP plan to invest in India requires a thoughtful evaluation of your financial goals, risk profile, and plan features. Here’s a step-by-step guide to pick the right plan for specific needs:

1. Define Goals

Every investment decision begins with a clear understanding of unique objectives.

• Short-Term Goals: These could include saving for a child's education in 5-10 years. For this, ULIPs offering balanced or debt funds are suitable.
• Long-Term Goals: For retirement planning or wealth creation over 15-20 years, equity-oriented ULIPs can deliver higher returns.
• Life Cover Needs: Ensure the plan provides adequate life insurance to protect your family’s future.

2. Assess Risk Appetite

Risk tolerance plays a crucial role in selecting the right ULIP funds:

• Aggressive Investors: Equity funds, while volatile, have the potential to deliver high returns over the long term.
• Conservative Investors: Debt funds provide steady returns with lower risk.
• Moderate Investors: Hybrid funds strike a balance between risk and reward, making them a good choice.

3. Compare Charges

Charges that are charged while investing in ULIPs can impact your returns significantly. Prioritize plans with low fees. Key charges to review include:

• Premium Allocation Charge: Deducted from your premium before investment. Look for plans with zero or minimal charges.
• Fund Management Charge: Typically 1-1.35% annually; lower charges mean higher returns.
• Policy Administration Charge: Some insurers charge a fee for policy maintenance; opt for those with minimal or no charges.

4. Review Fund Performance

Consider the historical performance of the ULIP funds:

• Consistency Over Time: Look for funds that have delivered steady returns over 5-10 years.
• Benchmarks and Peers: Compare fund performance against industry benchmarks and similar plans.

5. Look for Flexibility

Flexibility is a must check factor before investing in ULIPs, and the best plans offer:

• Free Fund Switches: This feature allows you to adapt your investment mix to changing market conditions or personal milestones without tax implications.
• Top-Up Options: Boost your investment when you have surplus funds to achieve higher returns.
• Partial Withdrawals: Ensure the plan allows penalty-free partial withdrawals after the 5-year lock-in period.

6. Check the Insurer’s Claim Settlement Ratio (CSR)

A high CSR reflects an insurer’s reliability in honouring claims:

• CSR Above 95%: Indicates a trustworthy provider with a smooth claims process.
• Customer Reviews: Check customer feedback for insights into service quality and efficiency.

By thoroughly analyzing these aspects, any investor can confidently choose a ULIP plan that balances life cover and investment growth. It is very important to conduct your own research before choosing a ULIP plan to invest in.

Top ULIP Plans to Invest in India

Unit Linked Insurance Plans (ULIPs) offer a dual advantage of insurance and investment, making them one of the most attractive financial products for Indian investors.

Choosing the right one becomes crucial with a wide array of plans available in the market.

Below is the list of top ULIP plans in India, designed to meet diverse investment goals and ensure high returns.

1. LIC New Endowment Plan

The LIC New Endowment Plan is for individuals seeking steady growth combined with insurance protection. This plan offers a return on investment along with bonuses, ensuring that your long-term financial goals are met. Its flexibility and guaranteed additions make it one of the best ULIP plans available today.

Key Features:

• Long-term wealth creation with bonus options.
• Comprehensive life insurance coverage.
• Flexible premium payment terms to suit individual needs.
• Policy loans are available for added liquidity.

Why Choose LIC's New Endowment Plan?

This plan is ideal for risk-averse investors looking for secure and steady returns. The bonus options add a layer of wealth growth, making it suitable for conservative financial planning. Additionally, the life cover ensures the family’s financial security in case of unforeseen events.

2. HDFC Life ProGrowth Plus

HDFC Life ProGrowth Plus stands out for its customizable investment options, making it ideal for policyholders looking to maximize their returns. It is designed to help you achieve financial goals with high flexibility in fund allocation, making it one of the best ULIP plans to invest in India.

Key Features:

• Multiple fund options to suit risk appetite.
• Partial withdrawal facility after 5 years.
• Tax benefits under Section 80C and 10(10D).
• Flexibility to switch funds as per market conditions.

Why Choose HDFC Life ProGrowth Plus?

The ability to choose from a variety of funds provides investors the flexibility to tailor their investment strategy. This plan is perfect for individuals looking to balance risk and reward while enjoying the benefits of tax savings and life insurance protection.

3. SBI Life Smart Wealth Assure Plan

The SBI Life Smart Wealth Assure Plan offers the perfect blend of security and market-linked returns. This single premium plan is customised for those who prefer a one-time payment option with the potential for high returns, making it one of the best ULIP plans in the market.

Key Features:

• Single premium payment with no recurring obligations.
• Choice of equity and debt funds to balance risk and reward.
• Partial withdrawal allowed post 5 years.
• Loyalty additions to enhance fund value, starting from the end of the 15th policy year.

Why Choose SBI Life Smart Wealth Assure Plan?

This plan is particularly appealing to investors who prefer simplicity and convenience. The single premium option eliminates the need for continuous payments, while the flexibility to choose between equity and debt funds allows for a personalized investment strategy.

4. SBI Life eHealth Insurance Plan

For those seeking a digital, hassle-free solution, the SBI Life eWealth Insurance Plan is an excellent option. This plan combines simplicity with growth potential, making it a leading contender among the top ULIP plans in India.

Key Features:

• Automated fund allocation based on life stage.
• No premium allocation charges, ensuring higher returns.
• Comprehensive insurance coverage with market-linked growth.

Why Choose SBI Life eWealth Insurance Plan?

This plan’s automated fund allocation makes it an attractive choice for individuals who prefer a hands-off approach. It adapts to your changing needs through various life stages, ensuring financial growth while minimizing risk.

5. HDFC Life Click 2 Invest ULIP Plan

The HDFC Life Click 2 Invest ULIP Plan is a cost-effective and high-growth investment option designed for long-term wealth creation. This plan stands out due to its transparent structure and a range of fund choices catering to different risk profiles.

Key Features:

• Zero premium allocation and policy administration charges.
• Flexible premium payment options: single, regular, or limited.
• Partial withdrawals are allowed after a 5-year lock-in period.

Why Choose HDFC Life Click 2 Invest ULIP Plan?

This plan is personalised for individuals aiming for wealth maximization without incurring high costs. Its multiple fund options and flexible premium payment terms make it a perfect solution for varied investment goals. Additionally, it provides strong financial security and growth opportunities.

6. HDFC Life Click 2 Wealth ULIP Plan

The HDFC Life Click 2 Wealth ULIP Plan is an investment solution that combines digital accessibility with comprehensive benefits, making it a standout choice among the top ULIP plans in India. This plan ensures that every penny of your premium is invested, due to its zero premium allocation and policy administration charges feature.

Key Features:

• Zero Allocation Charges: Ensures full premium investment without deductions.
• Wide Range of Funds: Offers multiple fund options, including equity, debt, and balanced funds, to match diverse risk appetites.
• Premium Waiver Benefit: Protects future premiums in case of the policyholder’s death.
• Top-Up Option: Allows additional investments to boost fund value.

Why Choose HDFC Life Click 2 Wealth ULIP Plan?

This plan is perfect for investors seeking maximum value for their money. Its cost-effective structure, combined with the flexibility to switch funds, ensures optimized returns. The premium waiver feature adds an extra layer of financial security, making it ideal for long-term wealth creation and protection.

Why Invest in ULIPs?

ULIPs are among the best investment plans in India as the flexibility in fund allocation and the potential for high returns make ULIPs a favoured choice for investors.

When choosing a ULIP, evaluating factors such as your risk appetite, financial goals, and the plan’s flexibility is essential. The options listed above represent some of the best ULIP plans in India, ensuring a balance of security, growth, and returns. Here are the top reasons why ULIPs remain a popular choice,

• Dual Purpose: ULIPs seamlessly merge life insurance with investment opportunities. Unlike standalone insurance plans, ULIPs offer the added advantage of growing your wealth over time.
• Goal-Oriented Savings: ULIPs can be customised to meet specific life goals such as funding your child’s education, buying a home, or building a retirement corpus. The ability to align your investment with your milestones ensures focused financial planning.
• Market-Linked Growth: With exposure to equity, debt, or hybrid funds, ULIPs offer the potential for higher returns compared to traditional insurance plans. This makes them particularly attractive for long-term investors looking to beat inflation.
• Tax Benefits: Under Section 80C, you can claim deductions of up to ₹1.5 lakh on premiums paid. Maturity payment amounts are tax-free under Section 10(10D), subject to a few conditions. The tax efficiency extends to fund switches, which are not subject to capital gains tax.
• Flexibility: ULIPs provide unparalleled flexibility in managing your investments. Features like fund switches, top-ups, and partial withdrawals make them adaptable to changing financial needs.

By offering a blend of protection, growth, and tax savings, ULIPs serve as an ideal financial planning instrument.

Wrapping It Up

With their dual benefits of life insurance and market-linked growth, ULIPs address both protection and wealth creation needs effectively.

Whether for a first-time investor or someone seeking portfolio diversification, selecting the best ULIP plans to invest in India ensures financial goals remain on track. These plans also provide a balanced approach to achieving long-term financial stability and growth.