Endowment Plan
A life insurance endowment policy pays the full sum assured to the beneficiaries if the insured dies during the policy term or to the policy holder on maturity of the policy if he/she survives the term.
It is a saving component and lump sum maturity benefit, thus fulfill the dual need for a life cover and savings under a single plan.
Financial Protection
An added advantage is the life risk cover which would be of great help to the family and loved ones if something untoward happens to the main bread winner.
Goals Based Saving
Endowment plans offer a disciplined way of saving money for future financial needs. You can choose suitable plan amongst variety of plan for your life events.
Tax Benefits
Investor can avail tax benefits under section 80C and 10(10D) of the Income Tax Act for policy period
Loan Against policy
Investor can avail benefit of Loan Against policy where he/she can present policy papers while taking emergency loans
Addition of Riders
Riders are the additional benefits that help broaden the scope of your existing policy. With the help of riders, you can enhance your sum assured and cover those situations that the base policy doesn’t.
Why to consider endowment plan
How does an Endowment Policy Work?
An endowment plan involves both a death benefit and a maturity benefit. These will be available provided you pay all your premiums.
1. If you die during policy term
In this case, your family members will receive a death benefit. This is the sum assured that is decided at the start of the policy.
Along with this sum assured, your family will also receive the guaranteed yearly additions or any other bonus depending on the policy.
2. If you survive the policy term
If you survive your endowment policy’s term, then you will receive a maturity benefit. This is the guaranteed sum that you will receive at the end of the policy. Other benefits, such as guaranteed yearly additions and loyalty additions, are also available.
Unit Linked Endowment Plan
In unit linked endowment plans, the premium that you pay is divided into 2 parts.
One part is used to purchase units in different investment funds as per your preference, and the other part goes toward your life insurance cover.
This is one of the best saving plans that investors usually put their money in.
Guaranteed Endowment Plan
Under this plan, the policyholder receives guaranteed benefits. At maturity, the policyholder gets the Sum Assured along with any loyalty additions, if any.
Apart from that, with the Guaranteed Savings Plan, if the policyholder survives the term, they will receive:
1. Guaranteed Sum Assured on Maturity, plus
2. Guaranteed Yearly Additions, plus
3. Guaranteed Loyalty Addition
Full/With Profit Endowment Plan
Under such a plan, the life insured is allowed to accumulate funds, which are usually paid after a determined period. This plan is specially designed to help the policyholders build a corpus to secure their future or to help them pay off their loans and mortgages.
Even if the policyholder passes away while the policy is in force, the nominees or beneficiaries will receive the Sum Assured.
Low Cost Endowment Plan
In this plan, the premium amount is less and helps you to save for future payments, due after a certain period. The insurer guarantees3 the sum your nominee will receive in case of an eventuality. Yearly bonuses also increase the amount payable to you at maturity.
The primary purpose is to create a fund within a defined time frame. You can, thus, use this type of endowment to finance loan repayments or specific life goals.
Non-Profit Endowment Plan
This policy offers a specified lump sum amount to you on maturity or to your nominee in case of any unfortunate event, whichever occurs earlier. The payout money remains unchanged as the insurer does not offer bonuses with such plans.
Thus, these plans are ideal as safety nets for your family against any financial distress in your absence.