ULIP vs mutual fund + term: which builds more wealth?
By Editorial Team· 28 May 2026· 7 min read
The age-old debate: should you bundle insurance and investment in a ULIP, or keep them separate (term plan + mutual fund SIP)? The answer depends on your discipline and tax situation.
Costs
ULIPs in 2026 charge 1.0-1.5% in fund management fees + premium allocation charges (now capped). Mutual funds charge 0.5-2.0% expense ratio. ULIPs win on tax (no capital gains tax) but lose on flexibility.
Verdict
If you'll stay invested 10+ years and value tax-free maturity, ULIPs are competitive. If you might need to redeem early or want fund flexibility, MF + term is cleaner.
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Editorial Team
Independent insurance writers and former product managers from leading insurers — focused on plain-English explainers, no marketing fluff.
Published 28 May 2026· 7 min read
