Unit linked insurance plans and their applications in India

Abstract

This paper focuses on a modern insurance plan, called unit linked insurances, where differently from the traditional life insurance, the policyholder gets guaranteed insurance benefit, whereas in case of unit linked insurance policies, the policyholder gets both guaranteed insurance and non-guaranteed investment benefits. Both deterministic and stochastic approaches for unit linked insurances are considered with examples. Apart from the theory, an overview of the insurance industry in India and different unit linked insurance products is given.