ULIP Vs Term Plan Commission: Which Is Better For Agents?

Among the many products that HDFC Life offers, ULIPs (Unit Linked Insurance Plans) and Term Plans are the two most discussed when it comes to commissions. Both have very different payout structures — one focuses on percentage of premium, the other on ticket size.

For agents, choosing which product to prioritize in 2025 depends on their client base, sales strategy, and long-term income goals. Let’s break down the commission differences.

Term Plan Commissions (2025)

First-Year Commission: Around 30–35% of premium.
Renewal Commission: ~7.5% annually from the second year onwards.
Ticket Size: Usually lower, since premiums are affordable (₹15,000–₹40,000 yearly).

Example: Selling a ₹25,000 annual premium term plan at 35% = ₹8,750 upfront commission, plus ~₹1,875 every year as renewal.

Best for agents targeting mass market clients who want pure protection at low premiums.

ULIP Commissions (2025)

First-Year Commission: Only 2–7% depending on product.
Renewal Commission: 1–2% annually.
Ticket Size: Typically higher — ₹1.5–₹5 lakh annual premium for wealth clients.

Example: Selling a ULIP with ₹2 lakh annual premium at 5% commission = ₹10,000 first-year income, plus ₹2,000/year renewal.

Best for agents focusing on HNI clients who prefer investment + insurance.

ULIP vs Term — Income Comparison

Factor	Term Plan	ULIP
Commission %	30–35%	2–7%
Typical Premium	₹15k–40k	₹1.5L–5L+
First-Year Income	₹8–12k	₹10–25k
Renewals	7.5% (strong)	1–2% (modest)
Client Profile	Mass-market	HNI / Wealth

Which is Better for Agents in 2025?

Term Plans: Higher commission percentage, steady renewals, easier to sell. Great for scaling volume.
ULIPs: Lower commission %, but higher ticket size can deliver bigger cheques per client. Better for fewer, wealthy clients.
Balanced Approach: Smart agents in 2025 mix both — selling term plans for quick % income and ULIPs for high-ticket wealth business.

Conclusion

There’s no one-size-fits-all answer. Term plans give high percentage margins and steady renewals, while ULIPs give big-ticket payouts despite lower percentages. The most successful HDFC Life agents in 2025 are those who combine both, tailoring their sales to client needs while maximizing commission potential.