What is Fund Switching?
When you buy a ULIP plan, you also select the funds that you want to invest in.
Based on your preference, you also select a percentage that you want to invest in each fund. This is called Fund Apportionment. During the policy period, you may want to change these investment amounts based on how the markets are performing. This activity is called Fund Switching.
Please see bottom of this article for information on Bajaj Allianz funds and their description.
Can you explain this with an example?
Sure, Let’s take the example of Mr. Rajesh who has a bought a policy for Rs. 50,000.
Does the new apportionment carry forward into the next year when I pay my renewal premium?
No! Please remember that when you make a fund switch the apportionment and the allocation applies to the current year only and does not get automatically rolled-over to the next year. In the above example, when Mr. Rajesh pays his renewal premium next year, the fund apportionment/allocation will be the same as his original apportionment that he had requested at the time of purchase (ie. Debt Fund 20%, Equity Index Fund 50%, Equity Plus Fund 30%).
How do I make the Fund Switching settings permanent?
The Bajaj Allianz funds:
Fund Name |
Description |
|---|---|
Equity Growth Fund II |
Provides capital appreciation through investment in selected equity stocks that have the potential for capital appreciation. |
Accelerator Mid-Cap Fund II |
Achieves capital appreciation by investing in a diversified basket of mid cap stocks and large cap stocks. Minimum 50% of Equity Investments would be in Mid Cap stocks |
Pure Stock Fund |
Specifically excludes companies dealing in Gambling, Contests, Liquor, Entertainment (Films, TV etc.), Hotels, Banks and Financial Institutions. |
Asset Allocation Fund |
Realizes a level of total income, including current income and capital appreciation, which is consistent with a reasonable investment risk. The investment strategy involves a flexible policy for allocating assets among equities, bonds and cash. The fund strategy is to adjust the mix between these asset classes to capitalize on the changing financial markets and economic conditions. The fund adjusts its weights in equity, debt and cash depending on the relative attractiveness of each asset class. |
Hope you found the information presented in this article useful. Please leave your questions in the comments section below. Thanks!
Know more about fund switching and other ULIP benefits on Bajaj Allianz Life.
