Wait till Jan 1 to buy Ulips

Here’s a word of advice for those seeking to buy unit-linked insurance plans (Ulips) before the year-end: Don’t. Wait till Friday or after, as starting January 1, various charges on ulips are set to be reduced. By waiting for four more days, you could save 0.5-1% on fund management fees that life insurance companies charge. The mortality and morbidity charge structure on these plans, too, has been changed. I Sambasivarao, appointed actuary of Star Union Dai-ichi Life Insurance, says people buying Ulips are better off waiting till January 1. Some products compliant with the lower-charge rules are already available. V Srinivasan, chief financial officer at Bharti AXA Life Insurance, suggests that if you are buying an Ulip now, “ask the advisor whether it is compliant with the new rules” and then make your investment. Companies such as LIC, HDFC Standard Life and Star Union Dai-ichi are cutting down on internal expenses to offer lower charge products to customers.