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In the world of investment ULIP is a common term used by people these days. In this modern world where investment and banking are playing a huge role in everyone’s life,each and every person should have a basic knowledge about investment policies and banking,and also the difference between investment and insurance. Investment is that particular field where a person can invest his money for a return in his life time,but in insurance an insurer (the insurance company) and the insured(the person) are tied up by a contract where the insured  pay an  amount to the insurer as compensation if any accident or unexpected incident occurs.

An insurance policy can only ensure our life but Unit Linked Insurance Plan(ULIP)is the  one insurance policy in which we can get the insurance for our life as well as we can get the returns for our investments  because in ULIP the premium amount we pay is invested in stock  market by the company and  returns better income on maturity period for this. In India investments in ULIP are covered under Section 80C of IT Act. The concept of having an investment is governed by the  Insurance Regulatory and Development Authority (IRDA).

Structurally both ULIP and Mutual Funds  look same but Mutual Funds is quite a good option if it is for a 5yr or even shorter time ,as ULIP has a high first year charges,but if someone  is planning for long time investment then ULIP has an edge because in ULIP though it has high first year charges towards acquisition,including agents’ commission but in long term ULIP policy holder’s premium comes  on regular basis so it’s easy for  managers to invest the money in  a systematic way in the market,whereas mutual fund  managers have many investors and they can move their money in and out from any scheme at a short notice.

So in the end if some one is planning for long time investments ,then he/ she must have an ULIP because at the end of the maturity he would get more money from ULIP than Mutual Funds.

Financial advice is available from a entire range of sources, but not all of them are working for your best interests to advise financial products that suit your situation. A professional adviser should evaluation your financial affairs by taking details of your current situation, objectives and attitude to risk and then return a written report recommend products that meet your needs and explanation why they are recommended. A financial adviser is a professional who renders investment advice and financial planning services to individuals, businesses and governments. Chartered financial advice is a specialized knowledge area. Often you will find that a qualified independent financial adviser will be approved to offer financial advice to businesses, individuals and in fact most people with a need for sound financial advice. Many people get so much financial advice yet it fails them. Why? The major cause is consumers don’t know who to trust and why. Banks sell products and they want you to buy their products so they tell you only about their products and services.