Ten market-linked insurance funds beat Nifty on fiscal returns

After remaining in the dumps for a long time, the market-focussed funds of life insurance companies seem to have bounced back and at least ten of them have given better returns than the stock market index Nifty.

Commonly known as ULIPs (Unit Linked Insurance Plans), these funds invest the money collected through life insurance polices into equity and debt markets and share the returns with the investors after deducting certain fees and charges.

The stock market benchmark index Nifty recorded a gain of 17.98% in the latest fiscal ended March 31, 2014, while at least ten equity-focussed ULIPs have given a better return during this period.

Topping the charts, Aviva Life's LifeLong Enhancer scheme has given a return of 27.93%, followed by ICICI Pru's Life Time Maximiser fund (25.5%) and SBI Life's Horizon Equity Fund (23.87%).

There are funds managed by Reliance Life in the top ten - at fourth and seventh places.

Reliance Life's Life Equity Fund 2 has given a return of 23.69%, while its Life Equity Fund 3 gave a return of 21.28%.

Others with better returns than Nifty include funds managed by Bajaj Allianz Life, Bharti AXA Life, Tata AIA Life, Kotak Mahindra Life and ING Vysya (now known as Exide Life Insurance) with returns ranging from 18-23%.

At least four other funds have also given returns close that that of Nifty and these include ULIPs offered by Max Life, HDFC Standard Life, Birla Sunlife and PNB Metlife.

Estimated total assets under management of Unit-Linked Insurance Plans (ULIPs) across the industry is about Rs 2 lakh crore, which is equally divided among equity and debt.

While the overall performance of the stock market for the last fiscal was bullish in 2013-14, mutual funds also generated robust investor interest and their total asset under management grew by over Rs 40,000 crore during the last fiscal to about Rs 8.6 lakh crore as on March 31, 2014.