ULIP is unit link Insurance Plan, which provide insurance as well as capital appreciation of the Premium paid. ULIP provides the combination of two products in the premium of one. So what are the problems with ULIPS? 

1. Un-sufficient Insurance 

Before purchasing insurance plan we should know how much Cover we required. ULIP provides very less Life Cover with high premium. For most of the ULIPs premium paid is tax exempted under section 80(c) subject to premium is not more than 10% of sum assured hence most of ULIPs life cover is 10 times of premium paid. Suppose I want 20L life cover then I have to purchase a ULIP with the premium of 2L. Is this cover is justified with this premium?