Endowment Assurance Plan Definition

There are different types of life insurance policies available in the market. One such plan is the endowment assurance plan. Read on to know more about it.Many life insurance policy buyers in India prefer buying endowment plans because it offers guaranteed returns. There are different types of endowment plans, and one of the most popular ones is the Endowment Assurance Plan. It is a combination of pure term plan and pure endowment plan.The pure endowment policy only offers a death benefit, whereas a pure endowment plan offers only maturity benefit with no death benefit. However, the endowment assurance policy offers both; if the policyholder passes away within the policy duration, the nominee is entitled to get the death benefit. Whereas, if the policyholder outlives the policy, he/she gets maturity benefit. Thus, it offers guaranteed returns.Typically, endowment assurance policy is offered by reputed insurance companies with profits. They give their customers the option to participate in the profits of the company by paying a higher premium and pay the bonus. This type of plan is called participating endowment plans. However, if the policyholders do not opt for the bonus, then it is referred to as a non-participating endowment policy.

An endowment assurance policy is an ideal life insurance policy for anyone who wishes to get life cover and assured returns. It is also beneficial for those who are yet to build their financial portfolio or have just started their professional career. Having an endowment plan will help you get life cover as well as secure your family’s financial future.But, you must know that the returns offered by the endowment assurance policies are not as high as the returns you may get from investments in money market instruments. But, remember, the primary objective of endowment insurance is to get protection against the life risks, and it can be an excellent addition in your portfolio along with a traditional term plan or a ULIP.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.