Claim Settlement Ratio of 99.23%~

What Are Unit-Linked Pension Plans And How They Work

Today, living a comfortable life has become a priority over than living longer. A majority of people opt for early retirement to live freely. However, an early retirement must be well-planned to ensure that you accomplish your life goals. To achieve these life goals one needs to plan their investments well so that they can accumulate the required funds to get their life goals done.

Investment plans also act as tax-planning tools, as many avenues help reduce tax liability. There are different types of investment plans, and by choosing the right one, you can invest according to your needs and grow your savings.Read Less

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Written ByPalak Bagadia
AboutPalak Bagadia
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Palak Bagadia, Associate – Digital Marketing at Bajaj Allianz Life, with experience spanning content and performance marketing, recruitment, employee engagement in the BFSI industry.
Reviewed ByRituraj Singh
AboutRituraj Singh
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Rituraj Singh,With over 6.5 years of experience in the insurance industry, Rituraj Singh, Manager- Product & Brand Marketing at Bajaj Allianz Life Insurance overlooks new product launches, compliance, and brand projects, leveraging artificial intelligence and technology to enhance outcomes.
Written on: 7th July 2024
Modified on: 7th July 2024
Reading Time: 15 Mins
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There is a plethora of options available for retirement plans in India. These are often referred to as pension plans. An ideal pension plan provides the policyholders with a maximum number of benefits during retirement. A policy like the Unit Linked Pension Plan (ULPP) is beneficial to retirees for multiple reasons. Before you buy this plan, go through this guide about ULPPs:

Meaning of Unit Linked Pension Plans:

ULPPs is a combination of investment and insurance. These ULPPs allows the policyholders to secure his post-retirement life goals with ease.

ULPPs is ideal for those investors looking for long-term savings. The lock-in period of five years doubles up the growth of the corpus in the due course. Therefore, opt for ULPPs to ensure financial support to achieve your dreams. The working of ULPPs is different from ULIPs, in terms of investment. Before buying ULPP, go through the operation of a ULPP to make informed decisions in the future. Take a look:

Working of Unit Linked Pension Plans:

1. The premium payment term

The premium is the base of every policy. At the inception, the investor must select the term of his premium payment. He can choose between regular, limited, or single premium payment options depending on his risk appetite. Once you purchase a plan, pay your premium on respective due dates for the continuation of the policy.

2. Deduction of charges

Apart from the policy administration charge, some of the charges that get deducted from the units are fund management charges, mortality charges, Allocation charges etc.

3. The vesting date

The vesting date is the end of your policy term. Once the tenure of the policy ends, the total fund value becomes your vesting benefit. The fund value is subjected to a guaranteed vesting benefit. It is 101% of the sum of premiums and the top-up premiums paid by the policyholders.

To sum up, every individual’s life goal is different. Whether you plan to achieve your life goals before your retirement or post-retirement, the choice is yours. Investing in pension plans ensure that these life goals turn into reality. However, before purchasing pension plans, utilize a pension plan calculator to understand your retirement corpus requirement.

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#Survey conducted by brand equity – Nielsen in March 2020

~Tax benefits as per prevailing Income tax laws shall apply. Please check with your tax consultant for eligibility.

**Past performance is not indicative of future performance.

The above information is for general understanding and is meant to educate the general public at large. The reader will have to verify the facts, law and content with the prevailing tax statutes and seek appropriate professional advice before acting on the basis of the above information.

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*Tax benefits as per prevailing Section 10(10D) and Section 80C of the Income Tax Act shall apply. You are requested to consult your tax consultant and obtain independent advice for eligibility before claiming any benefit under the policy.

~Individual Death Claim Settlement Ratio for FY 2023-2024

1Premium Holiday has to be selected at inception to avail this benefit and also depends on other policy terms & conditions


Bajaj Allianz Life Insurance Co. Ltd. | IRDAI Reg. No. 116

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%%Above illustration is for Bajaj Allianz Life eTouch- A Non Linked, Non-Participating, Individual Life Insurance Term Plan (UIN: 116N172V03) considering Male aged 25 years | Non-Smoker | Policy Term (PT)– 30 years | Premium Payment Term (PPT) – 30 years | Sum Assured opted is Rs. 1,00,00,000 | Online Channel | Standard Life | 1st Year Premium is Rs. 6,238. 2nd Year onwards premium is Rs. 6,659. Total Premium Paid is Rs. 1,99,349 | Medical Rates | Yearly Premium Payment Mode | Death benefit opted is lumpsum payout and monthly installments (Lumpsum Payout Percentage : 45, Income Payout Percentage : 55) | Premium shown above is exclusive of Goods & Service Tax/any other applicable tax levied, subject to changes in tax laws, and any extra premium and is for illustrative purpose only. This is inclusive of all the discounts mentioned above.

##Tax benefits as per prevailing Section 10(10D) and Section 80C of the Income Tax Act shall apply. You are requested to consult your tax consultant and obtain independent advice for eligibility before claiming any benefit under the policy.Above Tax benefit is calculated considering deduction of Rs. 150,000 and applicable tax rate of 31.20%.

@Term Insurance plan bought online directly from Bajaj Allianz Life Insurance has no commissions involved.

^^The Return of Premium amount is total of all the premiums received, exclusive of extra premium, rider premium and GST & /any other applicable tax levied, subject to changes in tax laws
Bajaj Allianz Life Insurance Co. Ltd. | IRDAI Reg. No. 116

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