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Should you opt for staggered settlement of maturity payout for Ulips?

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The Insurance Regulator and Development Authority of India (Irdai) on 4 April allowed life insurers to extend the option of staggered payments over a course of five years, even for policies that do not have the option of partial settlement, to offer respite to the holders of Unit Linked Insurance Plans (Ulips) from the ongoing market volatility.

Typically, on maturity of an Ulip, a lumpsum is paid. The 2013 regulation allowed insurers to pay the maturity value over a five-year period in instalments but it was left to the insurers' discretion whether they want to include this feature in all their policies or not.

In the wake of markets crashing as a side effect of covid-19, all unit-linked products now have the option of partial settlement

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