SIP vs ULIP: Investment vs Insurance

Never mix insurance and investment. Here is why mutual fund SIPs easily beat ULIPs over the long term.

1. The Core Difference

SIP: A pure investment product. 100% of your money goes into the market.
ULIP: A hybrid product. A portion of your premium goes toward life insurance (mortality charges), and the rest is invested in the market.

2. Lock-in Period

Mutual Fund SIPs (unless they are ELSS tax-savers) have zero lock-in. You can withdraw your money tomorrow.
ULIPs have a strict mandatory 5-year lock-in period in India.