What is a top up contribution in a unit-linked investment plan? Is it beneficial to a policy holder?
In certain unit-linked plans, the policyholder has an option to contribute additional amounts over and above the regular premium payable under the plan. These top-ups do not alter the original sum assured under the policy. However, top-up amount allows the policyholder to increase his investment and savings at his own pace.
This facility is definitely beneficial to the policyholder because it gives him an opportunity to invest the surplus funds. Also, the top-ups are generally first adjusted against the following year’s premiums and save the policyholder against late payments or inability to pay in future years and increase the total investment amount giving you higher returns on your investment.
In certain unit-linked plans, the policyholder has an option to contribute additional amounts over and above the regular premium payable under the plan. These top-ups do not alter the original sum assured under the policy. However, top-up amount allows the policyholder to increase his investment and savings at his own pace.
This facility is definitely beneficial to the policyholder because it gives him an opportunity to invest the surplus funds. Also, the top-ups are generally first adjusted against the following year’s premiums and save the policyholder against late payments or inability to pay in future years and increase the total investment amount giving you higher returns on your investment.
