Ask Value Research

Don't Mix Insurance with Investment

Insurance should be treated as an expense. Buy a simple term cover to fulfill your insurance needs…

28-Mar-2013•Research Desk

I had invested Rs 10,000 for 5 years in a Bajaj Allianz ULIP. The current value of my invested Rs 50,000 is around Rs 56,000 today. Should I redeem my investments now? -Arjun

The fact that you're invested money has appreciated in value over the past 5-6 years is a good sign. Since the policy is now over 5 years old, you won’t face surrender charges if you redeem your investments. But before you do that, you should evaluate your insurance needs and buy a simple term cover.
Treat this insurance as an expense, and not as an investment. Once you’ve taken care of your insurance, start investing via SIPs in a diversified equity fund. And henceforth, refrain from mixing insurance with investments.

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