1. Disciplined Monthly Investments:
The systematic approach requires you to pay your policy premiums in monthly mode. The monthly investment mode provides affordability and flexibility, allowing you to spread the cost over time and potentially fit it into your monthly budget easily. This pays off in the long run, because you get to enjoy the benefits of compounding as well as benefit of averaging out your investments.
2. Averaging of Purchase Costs$:
It has been observed that attempting to time the market can often lead to missed opportunities and suboptimal outcomes. Staying invested with a long-term perspective tends to yield better results. It’s the time in the market and the discipline to continue investing, that enables wealth creation, in the long run. Additionally, if you make a one-time investment, you run the risk of making your investments at high price. The markets may dip after you invest, and that means you would have bought your units during a market high.
SISO way of investing helps average your purchase price.
Here’s an illustration that shows how. While the customer bought at different price points of 97.00 to 103.00, the average cost is only 99.22. As shown in the below table, systematic investing has brought down the overall purchase price. It is how SISO helps even investors with limited market knowledge to optimise their purchase costs without timing the market.
| Month | Premium Amount | NAV (Net Asset Value)* | No. of Units Purchased |
|---|
| 1 | Rs. 10,000 | 99.00 | 101.01 |
| 2 | Rs. 10,000 | 98.00 | 102.04 |
| 3 | Rs. 10,000 | 101.00 | 99.01 |
| 4 | Rs. 10,000 | 103.00 | 97.09 |
| 5 | Rs. 10,000 | 101.00 | 99.01 |
| 6 | Rs. 10,000 | 98.00 | 102.04 |
| 7 | Rs. 10,000 | 97.00 | 103.09 |
| 8 | Rs. 10,000 | 98.00 | 102.04 |
| 9 | Rs. 10,000 | 98.00 | 102.04 |
| Average | Rs. 10,000 | 99.22 | 100.82 |
*NAV – Net Asset Value, which represents per unit price of a a fund offered in ULIP product of the insurance company
3. Averaging of Redemption Prices$:
Just like the purchase costs, the redemption prices are averaged out with the SISO approach. This means that if the markets perform well during the redemption phase, you may benefit from the market movements because your average redemption price also goes up. Systematic withdrawal encourages a disciplined approach to withdrawing funds, preventing impulsive decisions based on market fluctuations. It allow you to receive a fixed amount regularly, providing a steady income stream without needing to sell a large portion of your investment all at once.
During market downturns, investors may be tempted to sell their investments to avoid losses. SISO approach helps prevent this by automatically withdrawing a fixed amount, allowing the remaining investment to potentially recover during market upturns. In addition, by withdrawing a fixed amount, you can avoid locking in losses during a market crash and allow your remaining investment to benefit from potential future gains.
During the COVID-19 pandemic, market volatility led to significant fluctuations in redemption prices across equity and debt funds. During the COVID 19 market crash in March 2020, global equity markets—including India’s—suffered severe downturns. The Sensex fell over 13% in a single day on March 23, 2020~~~. As a result, many investors who had invested money into mutual funds during the bull run were forced to exit at depressed NAVs.For instance, consider an investor who had invested ₹20 lakh through a lump sum or systematic investments before the crash. By March 2020, with NAVs down ~35–40%, the fund’s value might have shrunk to around ₹12.5 lakh. Forced by urgent financial needs, the investor redeems ₹12.5 lakh—locking in their losses—just as the market was hitting bottom.
This situation clearly illustrates how redemption during market lows can drastically reduce returns. Had the withdrawal been postponed, even by a few months—the investor could have benefited from the swift recovery that followed.
With solutions like SISO, investors can spread their investments across market cycles, reducing timing risk and offering better potential for growth—even during uncertain times. By continuing investments or by staggering redemptions during market falls, SISO helps investors avoid being locked into losses and ensures more stable, long-term wealth accumulation—even during turbulent times. SISO offers flexibility in terms of withdrawal frequency and amount, allowing you to tailor your withdrawals to your specific needs and Life Goals. It helps you maintain a long-term investment horizon, allowing your investments to grow over time,.
~~~Source: March 13, 2020 - 5 past instances when Sensex has seen bigger falls than today's intraday slide | The Economic Times
4. Increased Time in the Market$:
It is an open secret that time in the market is more important than timing the market. By choosing to withdraw your payouts systematically at maturity of the policy, your remaining fund value continues to be invested in the funds of your choice, thereby earning you returns even as you reap the rewards periodically.
5. Extended Tax Benefits:
The premium you pay for your ULIP policy is eligible for tax deductions u/s 80C of the Income Tax Act, 1961## (subject to provisions stated therein). Each year, you can claim a maximum of Rs. 1,50,000 as a deduction. Many savings plans also offer tax-free maturity benefits. For instance, for policies issued on or after 1st February 2021, the maturity benefit will be tax-free under Section 10(10D) if the aggregate annual premium paid for all ULIPs is up to Rs.2.5 lakhs.
SISO in Term policy - In Term policies with the Return of Premium (ROP) variant, the returned premium is tax-free. Customers have the option to receive maturity benefits either as a lump-sum payout or in easy instalments.
SISO in Savings/ Endowment products – maturity benefits are tax free .You can avail tax exemption under Section 10(10D) for all traditional savings, non-ULIP policies, provided the aggregate premium of all policies during a year of its tenure is less than Rs. 5 lakh.
6. Free Fund Switch option under ULIP Plans with SISO:
There is free fund switch option in ULIP SISO plans. Fund switching in a ULIP plan allows policyholders to move their investments from one fund to another within the same ULIP plan. This flexibility enables investors to adjust their portfolios based on changing market conditions, risk tolerance, or financial goals. Fund switching is a feature offered in SISO option under ULIP plans that lets you transfer your invested funds from one fund option (e.g., an equity fund) to another (e.g., a debt fund). This will help you to adjust to market volatility by shifting to more conservative funds when the market is uncertain, or to higher-risk funds when you anticipate growth. As your risk tolerance or financial goals change, you can adjust your portfolio accordingly. For instance, you might switch to less risky funds as you approach retirement.
Let us understand this with an example. Say, a customer invests in a ULIP policy and puts his money in 1 fund – Large Cap Fund. In future, he/she sees more gains in Mid Cap fund. In a mutual fund, he would have to see Large Cap investment, incur exit load and tag on gain, then invest in Mid Cap.
With the Fund Switch option in ULIPs with SISO option embedded, in the customer app, users can easily move their investments—like switching from a Large Cap to a Mid Cap fund—in just a few clicks. There are no exit or entry charges, and no tax on gains from the previous fund. Bajaj Allianz Life Insurance offers access to 18+ funds, including Large Cap, Flexi Cap, Mid Cap, Debt, and Index funds, allowing customers to manage their money effortlessly, anytime, anywhere.
7. Optimal Money Management with Life Cover:
SISO embedded policies come with a Life Cover to secure the future of your loved ones. Life cover option is available in both ULIP and traditional plans offered by Bajaj Allianz Life Insurance under SISO strategy of investment.
8. Additional Perks as Loyalty, Maturity Benefits, Return of Mortality Charges (ROMC~):
SISO embedded ULIP Policies (like Bajaj Allianz Life Magnum Fortune Plus III) offer Loyalty Additions, at the end of every year starting from the 10th policy year. Maturity Benefit will be payable on the survival of the life assured to the maturity date, provided the policy is in force. This plan has option to take death & maturity benefit in instalments (Settlement Option). Depending on plans, you have an option to get back all charges levied for insurance cover, like Return of Mortality Charges (ROMC)~. At the end of the policy term, on the date of maturity, the total amount of mortality charge deducted throughout the policy term w.r.t. regular premium and top-up premium, if any, will be added back, respectively, into the Regular Premium Fund Value and into the Top up Fund Value, as applicable. This helps you to get more value for your investments & realize your life goals.
No ROMC~ will be available in a surrendered policy, a discontinued policy or a policy converted to paid-up.
9. Guaranteed* Returns in traditional policies:
The SISO approach is not just suitable for ULIPs. It also works in case of other investment plans offered by Bajaj Allianz Life, like guaranteed* income saving plans and annuity-based retirement solutions. All you may consider doing is selecting the suitable plan and choosing the SISO investment option. You can enjoy Systematic Guaranteed* returns and meet your life goals with added perks of guaranteed* income and bonuses$$$ from Bajaj Allianz Life Insurance. For E.g., Our Product of the Year 2024, Bajaj Allianz Life ACE - A Non linked, Participating, Individual Life Insurance Savings Plan, offers lucrative options, wherein the customer can choose to receive income from first month or after a fixed period. You can decide your income (fixed or increasing) amount based on your need and life goals. You can also avail cash bonuses along with guaranteed* income.
An ISO 9001:2015 
