Ok rub your eyes…again…this is what you need to say if your income comes from advertising.

One respected pink paper has come up with an article saying why ULIP is the best product to buy.

If you read the article you may not think too highly of the writing, but you are at a huge risk of coming to the wrong conclusion.

Hdfc Life Insurance started the ULIP series with a real low asset management charges of 0.8% (should it not be mandatory for journos to go into their own archives?).

Then greed got better of them and they increased the asset management charges to 1.35%. Again it is convenient for the author to compare it to Hdfc Equity fund (at 1.5%) instead of say a Quantum fund or an Index fund – Hdfc Index fund is at 0.15% ( a tad lower than the ULIP).

Ok, not cribbing about the amc charges.

What else is bad about the Click 2 Protect policy from Hdfc? Well really, nothing. However my advice of staying away from combining Insurance and Investment stays as it is.

Why am I being a wet blanket when so many smart people are recommending this plan?

Well, because I am a cynic, and this industry needs cynics. Read on:

1. There is no visibility (in the article) about the risk charges. What if the risk charges are the highest in the industry?

2. At some stage if I need the money BUT need the cover also, I am stuck am I not?

3. I do not know of any ULIP with GUARANTEED charges – please clarify Mr. author what happens IF the company increases the amc costs?

4. What if the fund manager is lousy, but I need the risk cover. I must add at one point they had Sourabh Nanavati as the FM, but he moved on.

5. If I find a cheaper term plan, I can throw out a term plan, but will have to suffer the ULIP for the whole term – or at least till I reach a stage when withdrawing is NOT penalised.

6. When you talk of 1.35% amc will you please also write about the admin charges, upfront charges, etc? the article does not categorically say that there are no other charges…..

Now read the article too………………………………………it helps


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  1. You should read the comments section of the article as well. There are so many readers highlighting the negative aspects.

    Alas, there are many who are so happy to read the article…..

    I guess the purpose of the article would have been fulfilled – more business for the ULIP mentioned and a decent commission for the author of the article. General public be damned….

  2. What about the tax treatment? LT Cap Gain in Equity MF is zero whereas ULIP will have standard rates slabs for the whole amount(not only on capital gain)- am I correct Subra?

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