When it comes to balancing investment growth and life insurance protection, ULIPs (Unit Linked Insurance Plans) are one of the most flexible options available in India. Many investors look for 10-year ULIP plans because they offer a good balance between wealth creation and long-term commitment without locking funds for decades.
In this detailed guide, we’ll explore what ULIPs are, why a 10-year term is ideal for certain investors, top ULIP plans in India for 2025, and how to choose the right one based on your goals.
What is a ULIP?
A Unit Linked Insurance Plan (ULIP) is a hybrid financial product that combines:
- Life Insurance: Provides a death benefit to your nominees.
- Investment Component: Premiums are partly invested in equity, debt, or balanced funds to grow wealth.
The IRDAI (Insurance Regulatory and Development Authority of India) regulates ULIPs, ensuring transparency and protection for policyholders.
Key Features of ULIPs:
- Dual benefit: Protection + Investment
- Choice of investment funds
- Tax benefits under Section 80C and Section 10(10D)
- Partial withdrawal options after the 5-year lock-in
- Switch between funds without tax impact
Why Choose a 10-Year ULIP Plan?
A 10-year ULIP is ideal if:
- You want medium-to-long-term investment growth
- You need life cover along with investments
- You want flexibility in switching between equity and debt based on market conditions
- You aim for goal-based savings like education, marriage, or retirement buffer
Benefits of a 10-Year ULIP:
- Balanced Tenure – Not too short like 5 years (which may limit compounding), and not too long like 20 years (which may feel restrictive).
- Compounding Advantage – Equity investments tend to perform well over 8–10 years.
- Liquidity After Lock-in – Partial withdrawals possible after 5 years.
- Tax Efficiency – Gains after maturity are tax-free (subject to prevailing tax laws).
How to Choose the Best ULIP Plan for 10 Years
When selecting a ULIP, consider:
| Factor | Why It Matters | What to Look For |
|---|---|---|
| Fund Performance | Determines growth potential | Past 5–10 years’ returns |
| Charges | High fees can reduce returns | Low premium allocation and admin charges |
| Flexibility | Allows adjusting risk level | Unlimited free switches |
| Life Cover | Ensures family protection | Minimum 10x annual premium |
| Company Reputation | Reliability of payout | High claim settlement ratio |
Best ULIP Plans in India for 10 Years (2025)
Below is a comparison of top ULIP plans suitable for a 10-year investment horizon in India:
| ULIP Plan | Insurer | Fund Options | Policy Term Options | Premium Payment Term | Unique Features |
|---|---|---|---|---|---|
| ICICI Pru Signature | ICICI Prudential Life | Equity, Debt, Balanced | 10–30 years | 5–10 years | Zero policy admin charges, loyalty benefits |
| HDFC Life Click 2 Wealth | HDFC Life | 8 fund options | 10–30 years | Single/Regular | Return of mortality charges at maturity |
| SBI Life eWealth Insurance | SBI Life | Growth, Balanced | 10–20 years | Regular | No premium allocation charges |
| Max Life Online Savings Plan | Max Life | Multiple fund options | 10–30 years | Regular | Loyalty additions, partial withdrawals |
| Tata AIA Wealth Pro | Tata AIA | 11 fund options | 10–40 years | Single/Regular | Unlimited free switches |
Detailed Review of Top 5 ULIP Plans
1. ICICI Prudential Signature ULIP
- Why It Stands Out: No policy administration charges and loyalty benefits.
- Best For: Investors who want low charges and flexibility.
- Expected Returns (10 years, equity focus): 10–12% annually.
- Extra Perks: Wealth boosters added from the sixth year onwards.
2. HDFC Life Click 2 Wealth
- Why It Stands Out: Return of mortality charges at maturity, increasing net returns.
- Best For: Those looking for maximum cost efficiency.
- Expected Returns: 9–11% with equity fund mix.
- Extra Perks: Flexibility in choosing premium payment frequency.
3. SBI Life eWealth Insurance
- Why It Stands Out: No premium allocation charges, meaning more money gets invested from day one.
- Best For: Cost-conscious investors.
- Expected Returns: 8–10% depending on fund choice.
- Extra Perks: Online purchase discounts.
4. Max Life Online Savings Plan
- Why It Stands Out: Strong fund performance track record.
- Best For: Investors seeking long-term growth with flexibility.
- Expected Returns: 9–12% for equity-heavy allocation.
- Extra Perks: Loyalty additions enhance maturity value.
5. Tata AIA Wealth Pro
- Why It Stands Out: Largest variety of fund options for risk customization.
- Best For: Active investors who like to switch based on market trends.
- Expected Returns: 9–12% with dynamic allocation.
- Extra Perks: Unlimited free switches.
Cost Structure of ULIPs: What to Expect
ULIPs typically have the following charges:
| Charge Type | Description | Impact |
|---|---|---|
| Premium Allocation | Deducted before investment | Higher reduces invested amount |
| Fund Management | Annual % of fund value | Standard 1.35% for equity funds |
| Mortality Charges | Cost of life cover | Varies with age and sum assured |
| Policy Administration | Monthly fee | Lower is better |
| Surrender Charges | If exiting before lock-in | Avoid early exits |
Tip: Choose ULIPs with low charges and loyalty additions to maximize returns.
Equity vs Debt Allocation for 10-Year ULIPs
Your fund allocation decides how much your ULIP grows:
| Risk Appetite | Recommended Allocation | Expected 10-Year CAGR |
|---|---|---|
| High Risk | 80% Equity, 20% Debt | 10–12% |
| Moderate Risk | 60% Equity, 40% Debt | 8–10% |
| Low Risk | 40% Equity, 60% Debt | 6–8% |
Tax Benefits of ULIP Plans
ULIPs offer dual tax benefits:
- Section 80C – Deduction on premiums up to ₹1.5 lakh/year.
- Section 10(10D) – Maturity proceeds tax-free (if annual premium ≤ 10% of sum assured).
Note: Tax laws may change, so always verify before investing.
Who Should Invest in a 10-Year ULIP?
- Young professionals starting long-term investments
- Parents saving for a child’s education
- Individuals seeking tax-saving + insurance combo
- Investors wanting flexibility in managing portfolio risk
Tips to Maximize Returns from Your 10-Year ULIP
- Start Early – The longer your money stays invested, the better compounding works.
- Review Fund Performance Annually – Switch if your current fund underperforms.
- Avoid Early Withdrawals – Keep money invested for full tenure.
- Choose Low-Cost ULIPs – Charges significantly impact maturity value.
- Go Equity-Heavy Initially – Shift to debt funds in later years for stability.
Final Thoughts
A 10-year ULIP plan can be an excellent way to combine life insurance protection with wealth creation—provided you choose the right product and stay invested for the entire term.
For 2025, ICICI Prudential Signature, HDFC Life Click 2 Wealth, and SBI Life eWealth Insurance stand out for their low charges, strong performance, and flexibility.
If your goal is long-term wealth creation with tax efficiency, a carefully chosen 10-year ULIP could be the perfect fit.
Disclaimer: Returns mentioned are indicative and based on historical fund performance. Always read the policy document and consult a financial advisor before investing.