India, June 11 -- Unit Linked Insurance Plan, or ULIP, is an insurance cum investment tool that provides life cover to the policyholder while generating long-term wealth for him/her. In other words, the product not only serves as an insurance cover but is also an effective vehicle of investment at the same time.

While traditional insurance plans promise a certain percentage of guaranteed benefits, ULIPs invest a portion of the premium paid into market-linked funds, including equity, debt, or balanced funds. The growth of these investments depends upon the performance of the selected funds. ULIPs are regulated by the Insurance Regulatory and Development Authority of India (IRDAI) and have become a preferred choice for disciplined savings ...