Om Kotak Mahindra Life Insurance has grossed Rs 25-50 lakh (Rs 2.5-5 million) from high net worth individuals for its unit-linked offering -- Kotak Safe Investment Plan.

ICICI Prudential Life has seen an 88 per cent surge in the top-ups to its unit-linked policies in the second quarter. And Birla Sun Life Insurance has seen a 157 per cent growth in its unit-linked plans.

What does this mean? Leveraging the current bull run, cash-rich policyholders are investing more than their annual premiums in unit-linked insurance plans, thereby topping up the investment portion of the policy.

"There has been a surge in interest by high net worth individuals in investment-related risk products," says Abhay Aima, HDFC Bank country head, private banking.

Unit-linked plans are similar to mutual fund schemes, where the premium is invested in various funds in keeping with policyholders' risk appetite.

Some players allow for topping up the premium without affecting the sum assured (value of the base policy), allowing policyholders to purchase more units.

Unlike traditional insurance products, unit-linked plans offer transparency in returns in terms of net asset value and flexibility in investment options in debt, equity and a mix of both.

At Birla Sun Life Insurance, unit-linked products have more than doubled to Rs 47 crore (Rs 470 million), or 93 per cent of sales.

"The strong markets assists the selling process," says Birla Sun Life associate director (business development) Anjana Grewal.

ICICI Prudential Life's chief executive Shikha Sharma says the total linked business in the second quarter accounted for 77 per cent, against 67 per cent in the preceding quarter.

"Some people are buying because of the bull run. But the growth is largely due to the transparency and flexibility of the product," she adds.

The stock market buoyancy has seen a surge in NAVs of various unit-linked schemes. OM Kotak's plan launched in June saw a 17.6 per cent NAV growth from Rs 10 to Rs 11.76 in September end.

"We have received cheques of Rs 25-50 lakh from high networth individuals. If they stay with us for the duration of the insurance cover, we guarantee return of capital even if the NAV goes down," says Om Kotak CEO Shivaji Dam.

High net worth individuals would like to protect themselves from the market volatility and unit-linked plans offer a safety net unlike other investment products, he adds.

"Sure, the bull run has contributed to the growth in unit-linked plans. However, we are advising our clients not to invest based on short-term performance," says Aviva Life CEO Stuart Purdy.

Aviva's unit-linked contribution in the second quarter has is up from 30 per cent to 46 per cent in the first quarter.

Even state insurer, the Life Insurance Corporation of India, has an unit-linked pension plan in the offing.

"We have received a lot of interest from individuals and corporates for such a product." Today, LIC is aggressively positioning its earlier unit-linked plan -- Bima Plus hoping it will account for five per cent of the total business.

It sure is a case of making hay while the bull charges.