This usually refers to Unit linked Investment Funds. These are funds run by Life Assurance or Pension Companies. Such funds are used for individuals holding life assurance policies to invest in. The assets held within the fund are divided into a number of units. When an investor contributes to a Life Fund, units are allocated to investors in proportion to their investment.
A unit-linked product that can invest in, for example, equities, property, fixed interest securities and cash. When you invest, your money is used to purchase 'units' in a Life Fund. Many endowment insurance policies, whole life insurance policies and investment bonds are invested in Life Funds as this type of insurance combines protection with saving. Your policy returns are directly linked to the value of the fund's underlying investments, which means there is generally no guarantee to the value of your policy when it matures. Some Life Funds can be With Profits.