The reformation of Unit Linked Insurance Plan (ULIP) have proved their significance in the market as well as the lives of the investors, time and again. Since investors look for premature termination in a long term policy like ULIPs, it provides them with loyalty additions. These loyalty additions help the investors to take complete advantage of the full term of ULIP Policies.

Under ULIPs, loyalty additions are applied in two ways, that are, either as a percentage of fund value or as a percentage of the premium. The percentage of fund value is typically based on numerous factors like premium amount, the term of the policy, the term of premium payment, and the period of guaranteed additions. The percentage of premium is paid towards the end of the term. So if you’re wondering how to enhance your ULIP plans returns with loyalty additions, then keep reading:

Benefits of loyalty additions in a ULIP Plan:

When you invest in ULIPs, it promises you with numerous benefits. Amongst its various other benefits, loyalty additions are one of the many. Loyalty additions are a small add-on to the ULIP Policies which eventually leads to long term investment. Go through these benefits of loyalty additions that will keep you hooked to your plan for a longer period:

  • Long term investment

Typically, loyalty additions are not accrued on every year of investment. Nor are these loyalty additions related to the performance of your ULIP funds. The sole purpose of loyal additions is to provide the investors with an extra allocation for their investment. Keeping this extra benefit in mind, investors would be compelled to stick to the same plan for a longer period of time.

  • Reward offerings

An investor is liable to loyalty additions only if a major chunk of your premium is allocated towards your funds of investments. If that is the case, then your rewards will be calculated based on the percentage of sum assured. Further, it will be provided to the investor either on the maturity period or on regular intervals in every 3-5 years. However, the benefit computation and the criteria of eligibility might vary based on the type of your plan and insurance policy.

  • Payment of the premium

Loyalty additions are a unique feature offered by ULIPs as it offers the benefit of incremental allocation along with an increase in the premiums. It offers the investors with 4 premium slabs which range from Rs. 20,000-50,000, Rs. 50,000-1,00,000, Rs. 1,00,000-3,00,000, Rs. 3,00,000 and above. With the increase in income, there is an increase in the incremental allocation, simultaneously. Additionally, an investor is offered with an option to reduce his annual premiums up to the limit if Rs. 2,00,000.

  • Other additions

A policyholder is offered with customizable options in order to suit their requirements. Loyalty additions permit the provision of additional life and health benefits like numerous riders. These riders cover you in times of unforeseen events like critical illness, accidental death, and disability of the policyholder. Additionally, it not only includes a term benefit but also surgical benefits.

Extra perk addition to an insurance policy is surely nice but see to it that you do not depend on your entire investment decision on the foundation of loyalty additions. Loyalty benefits start off as a small amount but may not always turn out to be a higher return on investment.

However, the good news is that ULIPs are a perfect addition to your financial portfolio. Hence, in order to enjoy the benefits of loyalty additions and get them to enhance your ULIP returns, invest in a ULIP Plan. Apart from these additions, ULIPs also offer other ULIP benefits like a life cover, tax benefits, switching policy, and so forth that makes ULIP a worthy investment.

Enhance your ULIP returns with Loyalty Additions

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