Multiple choice

In case of ULIPs, which of the following statements is correct?

  1. Entire premium is invested in units.

  2. Premium less charges are invested.

  3. Premium less bonuses are invested in units.

  4. Premium less risk charges are invested.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

ULIP is a life insurance product which provides risk cover for the policy holder along with investment options to invest in any number of qualified investments such as stocks, bonds or mutual funds. In ULIPs, premium allocation charges, deducted from the premium, are for expenses incurred in issuing the policy.

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