Morningstar ULIP Fund Ratings-Check your ULIP performance

One of the hardest part for the existing ULIPs holders or to who are interested to go for ULIPs is to judge the performance of the particular ULIP. Considering the different types of cost, it is hard to judge the fund performance. The solution to this hardship is Morningstar Insurance Funds ratings.

Recently Morningstar, an independent rating agency started to rate ULIPs too. The rating is from the lowest performer of a single star to the best performer of five stars ULIPs. Oldest funds have given more weightage. In ULIPs each fund offers multiple plans and each plan being different expenses. So it is hard to judge it easily for the layman.

ULIPs are sold particularly as an investment product rather than an insurance product. But I think in current scenario you might not find any agent selling ULIPs. Reason is the drastic decrease in their commission structure from earlier. But these ratings will help you in finding the performance within a plan how a particular fund is performing. Below is the rating list of India’s top insurer LIC. For detailed performance and return % you may visit “Here

LIC's ULIP Performance and Rating

By looking at above ratings, you notice that none of LIC’s ULIPs are rated as a top performer (5 Star). But you can also judge yourself by individually going through the return what each fund type generated since its inception, 5 yrs, 3 yrs or short terms like in monthly too.  Hope this rating will actually help out investors for tracking their funds.

 

33 Comments

  1. Hi Basu can you please share some lights on SBI life Smart Privilege or do you have any articles of best ULIP plans or can you write some thing for them like you write for Mutual Funds

    Reply
    • Dear Shahnawaz,
      I usually follow the basics of investment called NEVER COMBINE INVESTMENT WITH INSURANCE.

      Reply
  2. Hi Basu,

    I have ULIP from ICICI Pru ( Life Time Premier Equity ).

    Tenure is 15 Years and Premium is 24000 anually.

    I have paid 5 premiums and the current NAV is about 1,62,000 for premium paid 1,20,000.

    my question is how do i calculcate the returns policy has acquired so far ?

    thanks in advance,

    Unmesh

    Reply
    • Unmesh-You can use online tools available or using excel you have to calculate the CAGR of the same.

      Reply
  3. Hello Basavaraj Sir,

    I am Raj, I have two ULIP’s with SBI from June 2008

    1. SBI Life Growth Pension Fund (Unit Plus-II-Pension Option I), 3k Monthly for 24 years
    Present Fund value INR 379521 & total monthly investment till date INR 255000.
    I want to use the maturity amount for my daughter’s education.

    2. UNIT PLUS-II REGULAR for SA 12 Lakh, 6k quarterly for life time., but I am planning to close it once it is 30 years.
    SBI Life Growth Fund 50 %
    SBI Life Equity Fund 50 %
    Present Fund value 239398 & total investments till date INR 174000
    Will use the mature amount for my retirement savings.

    Request your kindness please let me know shall I continue these plans or close them. I know both of them working well, but when I started these plans I was not knowing any thing on ULIPs ( not now too)..some one guided/misguided me……..I came to know lately that ULIP’s are not best option for corpus creation ……but I have already invested for 7 years now………really in a dilemma now to stop or continue ( if I stop I will loose all the 7 years of investment) & once again I need to think for the fresh investments.

    Your suggestions are greatly advantageous for my financial situation in future……

    best regards
    Ra

    Reply
    • Raj-When you are saying that both the plans working well, then how can you loose if you come out of these plans now? In my view, better you come out.

      Reply
      • Thanks Sir for a quick response.

        One more suggestion…….I don’t want to come out now…….my point is shall I continue investing for long term in ULIP’s or shall I stop now.

        regards
        Raj

        Reply
        • Raj-They are the costliest products of investing in equity (expenses are at higher end). Hence, suggest you to come out.

          Reply
          • Hi Sir,

            Thanks again. During these 7 years , I have already paid the mortality charges . Now they are charging only fund management charges…….I feel which is very minimal. It is better I mail the soft copies for your reference. Thanks a lot for your time & patience.

            regards
            Raj

            Reply
  4. Dear Mr Tonagatti,

    We have invested significantly in the LIC ULIP plans. Precisely in Market plus 1(since 2010) and money plus plan(since 2007) in the GROWTH fund category. We have 2 single premium investments (Rs. 50k each in Aug 2010 without any insurance or rider). In addition we have been contributing 55k annually to market plus 1 plan since Mar-2010 without any insurance or rider. Also we have been investing 10k/year in Money plus plan since Mar 2007 with insurance cover of 1 lakh. The current NAV of Market Plus 1 and Money plus are at 18.92 and 16.94 respectively. I think we have stayed invested in the plan for substantial period. These plans have given us dismal returns (significantly lower than Bank FDs and higher charges associated). We have stopped premium payments towards market plus 1(last premium paid Mar 2014). However we paid up 10 k in Mar 2015 for money plus in order to use the entire 80 C basket. We are planning to withdraw from these plan at an optimum time and invest in MFs maybe. What are your recommendations? Should we withdraw or stay invested without any further addition.

    Thanks
    Shri

    Reply
    • Shetty-Better to withdraw. No Hope that they perform well. But how you can time the market and say that this is my OPTIMUM TIME to withdraw? Buying product only for the sake of tax saving is a biggest blunder. Please try to define your goals then finally chose products.

      Reply
  5. I want to invest in Ulip. Please suggest good one

    Reply
  6. Dear Sir,

    I would like to know if AEGON Religare iMaximize Insurance Plan is a good ulip option to invest in for a long term basis 15 years.

    Also, could you suggest, if ulip plans are really beneficial to invest on a long term ?

    Thanks
    Neil

    Reply
    • Neil-Don’t club your investment with insurance. ULIPs hard to track and involve many charges. So better to opt out.

      Reply
  7. sir,
    i recently bought a icici prudential maxi miser fund v after suggestions from a employee/agent in icici bank.during the freelook period if i want to cancel my policy he is telling that u loose much money dont do that as i will get bad remark and so on.what should i do sir ,pls help me.shall i cont this policy or not.
    he is telling if u want shift to another ulip with icici .is this correct or not

    Reply
    • Amar-It is fight between your hard earned money Vs his bad remark. So if it is ok for you to loose money for the sake of his bad remark then continue. But my strict advice is to come out.

      Reply
  8. please let me know whether it is safe to invest in UTI ULIP or not?

    Reply
    • Rajesh-It is debt fund. So I don’t think will serve any purpose for long term investment. Also prefer to separate your insurance need with investment.

      Reply
  9. Dear Sir,

    I have taken HDFC unit linked Youg Star-2. I am having this plan since 2005. Yearly 15000 premium. since last two years I have allocated 100% in Liquid Fund.

    so, my question that what will be my allocation to earn more or guide me.

    Waiting for your reply

    Reply
    • Maunang-First let me know the reason of moving to Liquid Funds.

      Reply
      • Dear Sir,

        I actually I was afraid of Loss of money. Since 2005 there was not much improvement. Intially invested in some percentages in balance fund, liquid fund, equity.

        Pl suggest me.

        Reply
        • Maunang-Loss is due to the heavy expenses these ULIPs were involved. So if still fund is not performing well then better to come out.

          Reply
  10. Dear Basav

    Thank you for your answers to my query regarding the LIC ULIP.
    So far here is the list of ULIPs I have taken.
    LIC Market Plus I – Growth in August 2010 – Currently less than the premium invested. I plan to close this.
    SBI Life Unit Plus-II-Pension Option I in Dec 2007 – I surrendered this policy in Jan 2013 after it was way below the premium invested. I had enough of it after 6 years of patiently waiting, hoping against hope that a miracle may happen bu finally decided to cut my losses and run.
    SBI Life Smart Wealth Assure – in March 2011 – This is presently a little above the premium invested but certainly not better than an FD at any bank.
    SBI Life – Smart Elite Plan Gold Cover – in Jan 2013 – Again this is just above the premium I invested.

    My question is has anyone ever made any real gain on a ULIP?

    My overall experience is that they have fancy names, but there is a good chance that you burn your hands holding one.

    Regards
    Dinesh

    Reply
    • Dinesh-Have you noticed why the plans which you bought after 2010 are slightly +ve than the plans which were pre 2010? It is because the expenses involved in pre ULIPs Guideline from IRDA. This regulation restricting insurance companies in charging expenses on ULIPs. Better you close the plans which are pre 2010 and continue the plans post 2010 and wait for good timing of market. But do remember once again that equity investment is always for long term and you need to check twice before investing in any product cautiously.

      Reply
  11. Hi Basav

    I invested into a LIC Market Plus I – Growth in August 2010. It now worth less then Single Premium I invested.
    I am not sure how this policy got 3 stars by MorningStar.
    I feel their fund ratings is rigged.
    Should I pull out and reinvest ?

    Regards
    Dinesh

    Reply
    • Dinesh-You may be under loss but still Morningstar may giving 3 star rating due to the expenses involved in this fund. It will not count the amount invested and expense ratio of ULIPs. It only give rating on the fund performance. ULIPs are for long term investments. So better to wait for another couple of years then decide. But I will not guarantee you that how the fund perform in future to it’s peer. Hence track your fund regularly and once you see some +ve values then come out of it.

      Reply
      • Dear Basav

        Thank you for your reply. LIC has already withdrawn this policy. I feel I should cut and run with my losses. The LIC branch is also suggesting that I reinvest. LIC’s new Bhima Bachat(Plan No.816) is what they advise. They claim an IRR of 9.536% and Service Tax rate of 3.09% for a Policy Term of 9 years. How does this compare to say an FD with one of the major banks or the LIC’s Single Premium Endowment Plan (Policy No.817)?

        Regards
        Dinesh

        Reply
        • Dinesh-Superb idea by LICians 🙂 Do you know why they are suggesting to invest now by surrendering your ULIP? Currently there is a slow down in business because of launch of new plans. So they desperately in need of new business. Hence they are recommending this product. But it does not mean that I am suggesting you to stay with ULIP. To me both are bad products to invest. Instead I am bringing in the real motive. Ask them how they arrived at this 9.536% return, if possible share the same with me. Then we discuss further.

          Reply
          • Dear Basav

            I received a spreadsheet from the branch which I have sent you via email to [email protected].
            In fact the IRR is higher then I suggested earlier at 10.584%
            What is IRR?

            Regards
            Dinesh

            Reply
            • Dinesh-IRR stands for Internal Rate of Return. This is the way of calculating the return on investment when there are uneven cash flows in a period. I will check it and reply to you.

              Reply
  12. I am holding ULIP from UTI 10 Year Plan from 1992 .
    We get only bonus units as dividend on regular basis
    Do you advise holding the same or we should opt to switch to some other option.

    Reply
    • Manher-If you are holding that for expecting some regular income to then continue else better to switch over to growth option.

      Reply

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