Endowment information and comparisons
| User Rating: | |
| If alive at the end of the policy / coverage term: | Guaranteed payout |
| Factors to consider: | Benefit amount, premium, investment rate, coverage term |
| Definition: | Endowment is type of permanent life insurance in which the premium paying period is shorter than whole life insurance and the insurance amount is paid out within a certain period (10-20 yrs) or when the insured reaches a certain age. |
| Payment: | Death benefits paid at the time of death or a lump sum paid on maturity. |
| Premium: | Cost or premiums every month is comparatively expensive and premium paid over a shorter period of time. |
| Types: | There are three different types of endowment policies: with-profit, unit-linked and low-cost endowments insurance. |
| Advantages: | Limited period to pay premium, which builds cash value faster. Also, it is possible get a lump sum of cash in case of illness or at the time of maturity. |
| Components: | Insurance + Plus investment |
| Better suited for: | Endowment insurance is valid for a specific period – ten, fifteen or twenty years, up to a certain age limit. |
| Disadvantages: | Endowment insurance is more expensive and not so popular now. Also, since the growth depends on how the investments fare, there may not be significant increase of funds at the time of maturity. |