An endowment insurance policy is an insurance plan that pays the face amount of an insurance policy after a certain period at maturity or on the death of the insured, whichever is earlier. On the other hand, pure life insurance, like a term insurance plan, pays only if the insured person dies.
An endowment policy is also a form of financial saving. If the covered person remains alive beyond the policy’s tenure, he gets the sum assured along with other investment benefits that an insurance company may declare.
In addition to the basic policy, insurers offer various benefits such as double endowment, marriage, and education plans. The cost of such a policy, i.e., insurance, the premium would be higher but worth its value.
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