UTI Mutual Fund has decided to continue selling Unit Linked Insurance Product (ULIP) to its customers even though there is no clarity on the issue of fund houses selling such products. UTI sells ULIP plan of Life Insurance Corporation which happens to be one of the sponsors of the fund house. The product has been sold to about 5 lakh customers and has asset size of about Rs 3,100 crore. On the other hand, the Life Insurance Council, which is association of life insurance companies, recently decided against offering insurance covers to fresh unit-linked products sold by mutual funds from October 1. It was decided that insurer will not sell group covers to mutual funds that bundle life insurance with units and thereby create competition for ULIPs. Regulators including SEBI and IRDA have not come out with the guideline on the issue. Until it is clarified, the confusion would prevail, an industry observer said.
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