Reviewing a ULIP: HDFC Crest

Learn about how to understand a ULIP from Deepak Shenoy as he reviews HDFC Crest, a Unit Linked Insurance Policy.

1.      Understanding premiums and tenures

2.      The Guaranteed NAV, how it works and why it's not as good as it sounds

3.      A comparison with a Term Plan+MF combination - which is way better!

4.      Even performance of the ULIP has been sub-optimal compared to a mutual fund from HDFC (the promoter!)

5.      Costs and how they hurt your returns

(10 min)

Conversations: Manish Jain on What's Good About ULIPs

A 25 minute conversation with Manish Jain on Unit Linked Insurance Plans. In a twist, Deepak Shenoy from MarketVision speaks with Manish about what's good about them.

  • Who are ULIPs suitable for?
  • How do the new ULIP changes make the products better?
  • What kind of misselling goes on and should be avoided
  • And of course, who shouldn't be buying them.

(25 min)

ULIPs: No More "Cover Continuance"

It turns out(*) that the new guidelines for ULIPs in 2010 have claimed another victim: Cover Continuance.

The concept, prior to September 2010: if you bought a ULIP and stopped paying premiums after say 5 years, you could choose to continue to have

  • Insurance cover continued
  • in which case, Mortality charges and policy admin charges would get deducted from fund value.

Now, with the new regulations this is no longer allowed. If you stop paying premiums, you have to take back your money. Subramoney also mentions this in his blog.

At Yahoo: ULIPs or Mutual Funds?

A small story at Yahoo on the choice: Ulips or Mutual Funds.

(Posted in entirety)

It was the day they’d talked about 9 years ago. The first day of 2011.

“I’m on my way.”

Ganesh Raghupathi sighed. He had known Arnold would be late. But then, Arnold had two kids, and you always give that species a little more respect, and a little more time.

Arnold D’Souza was looking forward to the meeting. He walked in to the coffee shop, while Ganesh was clumsily switching on his laptop.

“Over here”, said Ganesh, raising his hand.

“Hi Guns!”, said Arnold. “Happy New Year! Let’s get started. To recap – it’s the 1st of January, 2011 and we are here to compare our retirement choices. I chose a Unit Linked Insurance Plan (ULIP) and you bought something else. Let’s see where we are today.”

“Thanks for the wishes, Arnie, and the same to you.”, said Ganesh. “Let’s see the chart:”


Reader Query: Should I exit this ULIP?

Reader S writes in:

Hey Deepak,
I am invested in 2 ULIPS.
1) Birla Sun Life SaralWealth : 35800 anually since Feb 2010 ( paid 1 premiums) current fund value is 25629.
2) Birla sun life Dream Plan: 12000 anually since Jan 2009 ( paid 2 premiums) current value is 20762
I also have a term policy of Birla sunlife premium of 7k annually and cover of 50 lakhs.
I was totally shocked to see 11000 deducted as loading charges on SaralWealth.
Please advice what would be the right time to get out of the policies and which policy should I retain.