Here it is important to remember
in endowment policies, you get the sum assured upon maturity, whereas in term plans no maturity benefit is paid out.
Life insurance policies, such
as endowment policies, unit - linked insurance policies and money - back policies, for which premiums are paid for at least three years are eligible for loan.
It is a single premium
endowment policy which offers 10 times of your single premium along with loyalty addition.
This is because
endowment policies provide returns that are higher than the term plans and may also provide the payout over a considerably longer period.
As far as taxes is concerned, your single premium insurance policy is viewed as a
modified endowment policy, and is treated differently from other life insurance policies.
Most endowment policies are available for longer terms as they help increase the overall returns that a person will get back at the end of the policy tenure.
Available to anyone, in the age group of 8 - 59 years, this limited premium paying
endowment policy ensures both death and maturity benefits for the policyholders and their nominees.
It is one of the non -
linked endowment policies, where the sum assured on death increases every five years, during the term of the policy.
The rate of return earned in the above example is just 5 % which
makes endowment policy a poor choice for making investments.
In this scenario, buying a convertible plan proves to be a cheaper option, compared to buying a
fresh endowment policy.
The investment planners study your case and assess your risk taking ability and risk appetite to further recommend an asset allocation plan or an
apt endowment policy.
In case of a
full endowment policy, the basis sum that is assured is similar to the death benefit that is applicable at the beginning of the policy.
For other types of life insurance policies such
as endowment policy, the maturity amount is payable at the end of the policy term on survival of the policy holder.
Just like other insurance plans, the securities industry is now flooded with different types
of endowment policies.
Returns
on endowment policies are conservative but guaranteed and these are meant for risk - averse individuals — those who prefer a steady though moderate return rather than take high risks for high returns.
Most endowment policies are the hot topic among all insurance agents and they will convince you with many catchy figures of return.
Also, the interest or bonus (cash value) earned on the premium is generally higher as compared to a with
profit endowment policy.
If you want to surrender the
new endowment policy before the expiry of lock - in period of 5 years then the fund value after deducting the discontinuous charge will be transferred to the discontinuous policy fund.
Human Life Value: An easy way to decide on the amount of
endowment policy cover is to calculate the policyholder's Human Life Value.
Easy Procedure: In case, you are heading to buy a fresh
endowment policy at 45 + years of age, a medical check - up would be required that may lead to rejection of insurance, due to the bad health condition.