Traditional plans include term policies, endowment plans, and whole life insurance policies. Traditional savings and insurance plans are created with risk-averse investors in mind. They offer the benefits of low risk and fixed returns in case of the policyholder’s death or policy maturity.
ULIP or Unit-linked Insurance Plans offer a combination of investment, insurance, and market-linked returns. Since the fund value of the ULIP is based on capital market conditions, they offer the potential of earning higher returns. You can choose where your premium money will be invested—high risk-high returns equity funds, low risk-moderate returns debt funds, or a balanced mix of both.