Unit Linked Insurance Plans

Investment planning may not seem important in your 20s. However, with time, it becomes an essential part of your life as you begin to realise the importance of matching your finances with life objectives.

With an investment plan, you can easily set out clear future goals for yourself and your loved ones. After that, the plan will help you create a combination of long-term investment options and maximise your existing finances to accumulate wealth.

Among the popular wealth-creation instruments available today, Unit Linked Insurance Plans (ULIPs) offer the benefits of both life cover and investments. Moreover, ULIPs offer investment opportunities into a variety of market-linked investment instruments, thus making them an exciting investment planning proposition for the long-term.

What is ULIP?

Unit Linked Insurance Plans or ULIPs are insurance products that combine the benefits of saving and protection in a single instrument. While the plan offers you risk coverage, it also introduces you to the various investment opportunities in the liquid investments, fixed income securities and equities.

Overall, ULIPs can be classified as a comprehensive investment and protection plan that allow you to invest in a variety of market-linked fund options. At the same time, you receive the benefit of life cover throughout the tenure of the policy. Therefore, ULIPs provide you with the opportunity to invest in different funds which can be chosen depending upon your risk appetite.

ULIP Calculator

ULIP calculators are provided by Future Generali to help you calculate the cover amount and corpus you may need. These calculators help in calculating the expected value of an investment in the future. You can input details such as the investment amount, investment frequency, the number of years you want to invest and that after which you need the fund value. Our ULIP calculators provide an estimate of the fund value assuming at 4% (conservative) and 8% (aggressive) investment rate of return.

How does a ULIP work?

You periodically pay the premium for the ULIP plan. Subsequently, the insurer deducts the charges and invests the remaining amount into different funds depending on your choice. Primarily, the money is invested in either debt, equity or balanced funds.

The remaining amount (or allocated premium) is utilised to purchase units from different fund. The number of ‘Units’ allocated under each fund depends upon the premium allocated and the NAV (Net Asset Value) of that fund. NAV of a fund is the price of each unit in that fund. The allocation of premium in different funds is done, by fund managers in proportions provided by you.

On maturity, you receive the accumulated fund value. The fund value for a policy is the total value of units across different segregated funds opted in that policy. In case of an unfortunate event (death), your nominee or beneficiary receives the higher of
i)   Fund value
ii)  Sum assured or
iii) 105% of premiums paid till date of death (the amount received as death benefit also depends on whether your policy is a Type 1 or Type 2 ULIP).

ULIP Fund Options with Future Generali

Future Generali offers a variety of ULIP fund options to suit your risk appetite.

You can choose to invest in any of the following six funds. In turn, the premium and, net of applicable charges, shall be invested in the funds of your choice. These funds are segregated into fixed income securities, liquid and equity investments, in line with their risk profile.

ULIP Charges

Future Generali deducts the following charges from your ULIP plan towards the administration services and cost of benefits it provides:

Administration Charges

These charges are deducted by Future Generali every month for the administration of your policy. Further, these charges are expressed as a percentage of premium (0.1% of the Annualized Premium, to be exact) per month.

Therefore, the company charges a minimum of Rs.50 and a maximum of Rs.500 as monthly policy administration charges. The company deducts them from the unit account at the beginning of each month by cancelling out the units in proportion.

Fund Management Charges

Fund management charges are deducted as a percentage of the fund's value before the fund reaches its net asset value. Also, these charges are deducted at 1/365^th of the annual charge every day.

The fund management charges for each fund option offered by Future Generali are given in the table below:

Switch Charges

Future Generali allows you to switch between equity and debt funds, at times when there are interest rate fluctuations, or the market is volatile. You may also wish to switch according to the changes in your liabilities, risk profile or financial standing.
You can switch between fund options without any additional cost, for up to 12 times in a policy year. After that, any subsequent switch would incur a charge of Rs. 100 each.
Also, these switching charges may increase to up to Rs.250 per switch in the future (subject to prior approval from IRDAI)

Mortality Charges

These charges are levied depending upon your age and the amount of cover. Here’s a summary of mortality charges for each investment plan from Future Generali:

Future Generali Easy Invest Online Plan
These charges are calculated using 1/12^th of the annual mortality charge and are deducted from the unit account by cancelling out units in proportion.

The charges are levied on the sum at risk which is the higher amount of (under the policy at any point of time):
  - the sum assured less Deductible Partial Withdrawal or
  - 105% of premiums paid.

For female policyholders, a 3-year age set back is used (except for female lives between 0 to 9 years of age). For example, the mortality charge for a 35-year old female shall be that of a 32-year old male. On the other hand, the mortality charge for a 9-year old female will be the same as that of a 9-year old male.

Future Generali Dhan Vridhi
These charges are levied at the beginning of each policy month from the fund. Below mentioned are the sample mortality charges for various ages for Rs. 1,000 of the sum at risk. Mortality Charges are deducted on sum at risk which is calculated as higher of Sum Assured less Deductible Partial Withdrawal, 105% of the total premium paid till that date reduced by Fund Value under the policy.
Mortality charges are deducted on the sum at risk, which is the higher amount of (under the policy at any point of time):
  - the sum assured less Deductible Partial Withdrawal or
  - 105% of premiums paid

Future Generali Wealth Protect Plan
Below mentioned are the sample mortality charges for various ages for Rs. 1,000 of the sum at risk. At the given point of time, the sum at risk equals the difference between the Sum Assured and the Fund Value.

Future Generali Bima Advantage Plus
This shall be levied at the beginning of each policy month from the fund. Following are sample mortality charges per Rs. 1,000 of the sum at risk.
Mortality charges are deducted on the sum at risk, which is the higher amount of (under the policy at any point of time):
  - the sum assured less Deductible Partial Withdrawal or
  - 105% of premiums paid

Future Generali Pramukh Nivesh ULIP
Deducted monthly (first business day of monthly cycle) for life cover by cancelling units. Following are sample mortality charges per Rs. 1,000/- of the sum at risk. Moreover, the Sum at risk at any point of time is equal to the Sum Assured

Premium Allocation Charge

This charge is levied as a fixed percentage of the premium that you pay (usually charged at a higher rate during the initial policy years). Subsequently, the net of premium allocation charges is used to purchase units in any of the five underlying funds as given below:

   -   Future Income Fund
   -   Future Balance Fund
   -   Future Apex Fund
   -   Future Opportunity Fund
   -   Future Maximise Fund
   -   Future Secure Fund

It is important to note that the Premium Allocation Charges vary in each product from Future Generali. Here’s a summary of the charges under each plan:

Future Generali Easy Invest Online Plan
The Premium Allocation Charge as a percentage of Annualised Premium is as per the table below:

Future Generali Dhan Vridhi
The Premium Allocation Charge will be deducted from the premium amount at the time of premium payment,. The premium remaining will be used to purchase units in various investment funds according to specified fund allocation.

Future Generali Wealth Protect Plan
The Premium Allocation Charge will be deducted from the premium amount at the time of premium payment. The premium remaining will be used to purchase units in various investment funds according to the fund, allocation specified by you.

Future Generali Bima Advantage Plus
The premium allocation charge will be deducted from the premium amount at the time of premium payment. The premium remaining will be used to purchase units in various investment funds according to the specified fund allocation.

Future Generali Bima Gain
For this plan, the premium allocation charges are deducted as a percentage from the premium before investing money at the rate of 2% of single premium.

Future Generali Pramukh Nivesh ULIP
No Allocation Charges are applicable in this policy.

Partial Withdrawal Charges

Future Generali also allows you to make lump sum withdrawals from the fund after three years of the policy term. However, such withdrawals attract charges, which are mentioned in the policy brochures of respective funds.

You can make up to four free Partial Withdrawals in each policy year, exceeding which, each subsequent withdrawal for the policy year shall attract a charge of Rs.200 each.

Discontinuance Charge

These charges are levied when the policyholder surrenders the plan prematurely. As per IRDAI's regulations, an insurer could recover only the incurred acquisition cost in this case. Moreover, these charges are deducted as a percentage of the premium and fund value. Also, it is important to note that the discontinuance charges vary with each product from Future Generali. To summarise, here’s an explanation of discontinuance charges under each plan.

Future Generali Easy Invest Online Plan
In case, you opt to discontinue the policy within the first 4 policy years, the following charges will apply:

Future Generali Wealth Protect Plan

Future Generali Bima Advantage Plus

Future Generali Dhan Vridhi

Future Generali Bima Gyan

Future Generali Pramukh Nivesh ULIP
Discontinuance Charges - None

Miscellaneous Charge

This charge is deducted for any alterations that happen within the insurance contract such as premium redirection and changes in premium mode. Subsequently, the charge is defined as a flat amount deducted by cancelling of units and is equal to Rs.250 per alteration. You will receive a one-month notice period in case there is an increase in the charges. The increase, in turn, will be applicable from the Policy Anniversary coinciding with or following the increase. Moreover, any change in the rate of charges or amount is subject to IRDAI approval and Service Tax (if any), as prescribed by the Government from time to time.

Eligibility Criteria and Documents Required for ULIPs

Eligibility criterion to purchase investment plans from Future Generali vary from product to product. Moreover,
   -   You must meet the requirements for entry age, as mentioned in the policy brochure before purchase.
   -   You cannot extend beyond the maximum age or policy term allowed under a ULIP plan.
   -   You must adhere to the mode, sum assured, and a premium payment term of the ULIP plan.