In January 2013, LIC Nomura revisited a scheme it had launched in 1989 and repackaged it as a tax saving instrument. In its new avatar, LIC Nomura ULIS will provide life insurance cover up to Rs 15 lakh along with free accident cover up to Rs 1 lakh. The scheme will have a 3-year lock-in, with investments up to Rs 1 lakh in a financial year qualifying for tax deductions under Section 80C.
The base mutual fund scheme in it will have 20-35 per cent investments in debt instruments and rest in equity. Also, there is no exit load and there will be a 2.5 per cent to 10 per cent maturity addition benefit. 
This fund has posted 9.27 per cent returns in the past 1 year, with negative returns over the past 5 years. These returns pale in front of an ELSS scheme which is purely into investments. We feel it is best to keep life insurance and investment separate. A combination of a pure term insurance and ELSS scheme offers the best way to combine the two needs with tax saving benefits.
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