Difference between ULIP & ELSS

ULIP or Unit linked insurance plan is offered by life insurance companies and is a combination of insurance and investment. ULIPs have high initial charges and are not smart investment products.

ELSS or Equity Linked Saving Schemes are nothing but tax saving equity diversified mutual funds. ELSS schemes have offered superior returns in the past years when compared to any tax saving instrument. For insurance requirements, opt for a term plan

Best Plans for ELSS

1.Sundaram BNP Paribas Tax Saver ( Current NAV: 43.81 )

2.SBI Magnum Tax Gain Scheme 93 ( Current NAV: 59.10 )

3.HDFC TaxSaver ( Current NAV: 203.74 )

For saving taxes u/s Section 80C you can choose 2-3 tax saving mutual funds like Magnum Tax Gain, Sundaram Tax Saver or HDFC Tax Saver. You can also explore other avenues like Bank FDs, NSCs or Life Insurance Policies.
Under section 80D, you can claim exemption on the medical insurance premium that you pay (i.e. medi-claim policies). You can purchase such policies from any general insurance company.

My suggestion to investors, choose ELSS funds instead of ULIP ( In general all employees will have Insurance policies with long term plans - ELSS may give you good returns in short term )

Cheers

Syed