InvestorQ : If I pay some amount towards my ULIP, is the full amount of my premium used to purchase units?
Priyanka Singh made post

If I pay some amount towards my ULIP, is the full amount of my premium used to purchase units?

Answer
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3 years ago
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No, the full amount of premium paid is not allocated to purchase units. It is after they have provided for various charges, fees and deductions, that insurers allot units on the portion of the premium remaining. The premium amount used to purchase units, however, varies from product to product.

A policyholder gets less value of units as compared with the premium paid and this is because the insurance company deducts the various charges it levies and only the remaining amount is used to invest.

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