What is Fund Switching and How Do I Switch My Funds?

24th September 2010
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What is Fund Switching?

Fund Switching

When you buy a ULIP plan, you also select the funds that you want to invest in.

Based on your preference, you also select a percentage that you want to invest in each fund. This is called Fund Apportionment. During the policy period, you may want to change these investment amounts based on how the markets are performing. This activity is called Fund Switching.

Please see bottom of this article for information on Bajaj Allianz funds and their description.

Can you explain this with an example?

Sure, Let’s take the example of Mr. Rajesh who has a bought a policy for Rs. 50,000.

What is Fund Switching

Watch a Demo
Watch a short presentation on how to login to the Customer Portal and switch your funds. Please note that you need Flash Player to view this animation.

 

Does the new apportionment carry forward into the next year when I pay my renewal premium?

No! Please remember that when you make a fund switch the apportionment and the allocation applies to the current year only and does not get automatically rolled-over to the next year.
In the above example, when Mr. Rajesh pays his renewal premium next year, the fund apportionment/allocation will be the same as his original apportionment that he had requested at the time of purchase (ie. Debt Fund 20%, Equity Index Fund 50%, Equity Plus Fund 30%).

How do I make the Fund Switching settings permanent?

You can make the Fund Switch permanent by changing the fund apportionment to be the same as that in recent fund switch. This can be done using the Fund Apportionment option in the service menu.

How to change fund apportionmentSee Demo : How to Change Fund Apportionment
In the example used above, Mr. Rajesh should set his new Fund Apportionment to:

  • Debt Fund 20 %
  • Equity Index fund 80 %
  • Equity Plus fund 0%

The Bajaj Allianz funds:

Fund Name Description
Equity Growth Fund II Provides capital appreciation through investment in selected equity stocks that have the potential for capital appreciation.
Accelerator Mid-Cap Fund II Achieves capital appreciation by investing in a diversified basket of mid cap stocks and large cap stocks. Minimum 50% of Equity Investments would be in Mid Cap stocks
Pure Stock Fund Specifically excludes companies dealing in Gambling, Contests, Liquor, Entertainment (Films, TV etc.), Hotels, Banks and Financial Institutions.
Asset Allocation Fund Realizes a level of total income, including current income and capital appreciation, which is consistent with a reasonable investment risk. The investment strategy involves a flexible policy for allocating assets among equities, bonds and cash. The fund strategy is to adjust the mix between these asset classes to capitalize on the changing financial markets and economic conditions. The fund adjusts its weights in equity, debt and cash depending on the relative attractiveness of each asset class.
Equity Index Fund II Capital appreciation through investment in equities forming part of NSE NIFTY
Bond Fund Provides accumulation of income through investment in high quality fixed income securities.
Liquid Fund Protection of the invested capital through investments in liquid money market and short-term instruments.

Hope you found the information presented in this article useful. Please leave your questions in the comments section below. Thanks!

Know more about fund switching and other ULIP benefits on Bajaj Allianz Life.

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What is the Life Customer Portal and what are the services available in it? | Knowledge CapsulesMarch 26th, 2015

[…] To find out what Fund Switching is, and how you can switch your funds via the Life Customer Portal, click here. […]

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