What would be the time period over which one could expect favourable returns from ULIPs?
ULIPs are well suited for meeting your long-term financial goals. The premiums paid by investors (net of insurance charges) are invested in funds as mandated by the policyholders. These funds invest in market-linked instruments such as equity, bonds and government securities. Since the returns on ULIPs are market-linked, they too might get impacted in short term. However, long-term returns do not get much impacted by such short-term volatilities. Over a long-term, one should expect favourable returns from ULIPs.
