Unit Linked Insurance Plans (ULIPs) are very complex products from the data management perspective. There are more than 25 insurance companies and each has many ULIP products and each ULIP product has 4 to 8 associated funds. ULIP holder can switch between the funds and the units are reduced to recover the mortality charges and other charges. We currently do not provide the NAV of each ULIP product. We will try to incorporate the same in future if we find it feasible.
In spite of the complexity, we have tried to provide the complete ULIP management module in MProfit. We believe that each investor would have one or two ULIP products to manage in his portfolio. How data should be entered and managed for ULIP products in MProfit is explained below in details.
Once you create the ULIP plan manually, fill out all the details about your policy (one time) and you can create the associated funds by going into Edit Fund Allocation. You can create the funds as per the plan you have chosen.
There are couple of ways you can set the current policy value to be reflected in your net worth summary.
Go to Transaction list of ULIP product and Click on the Set Current Value button and choose the appropriate option.
a) Periodically, (suggested monthly), you can go to Transaction List and Click on Other Transactions and click on Edit Fund Allocation and change the Quantity of units and NAV of your funds. The policy value will be calculated based on these data.
b) Second option is to calculate the policy value as per the total premium paid – withdrawal (Use Set Current Value feature)
c) Third option is to set the policy value manually. You can directly enter the policy value periodically (say monthly) based on the statement of your ULIP policy and this will be reflected in your net worth of your portfolio (Use Set Current Value feature). You do not need to enter the fund details and this is the simplest method to capture your policy value to be included in your net worth.
ULIP products are very long term in nature and we recommend them to update the policy value every month as per the statement of your ULIP policy based on your choice of setting. By doing this, you can almost capture the true value of your ULIP investments in your net worth summary.
You can manage the Unit Linked Pension Plans in the same manner, which will be without insurance details.