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Endowment Policy

Endowment plans are dual-purpose life insurance policies that provide safety and security to the loved ones of the insured in case of his sudden death (insurance-based) and solve the purpose of risk-free saving and investment options. This is an attractive insurance plan which has gained momentum for being a lucrative investment scheme and for providing insurance to the individual.

A good plan comprises various features and benefits of getting tax deductions, maintaining a sustainable and sufficient corpus to meet the unforeseen emergencies of life, and protecting the interests of the loved ones and dependent on the bread earner of the family in case of his demise. It is a shield that protects the insured and his family against unexpected contingencies and also helps him in meeting long term goals like the marriage of his children, meeting medical emergencies; maintain a retirement fund for a smooth old age, and paying for higher education for his children.

Types of Endowment Plans

These are the vehicles of savings and protection, which have been proved to be all-rounders in every respect. There are various kinds of endowment policies and plans, some of which ensure guaranteed returns each year based on the premiums paid towards the policy while some generate guaranteed maturity benefit which can help in obtaining long term financial goals. Let us study the various types of Endowment Plans:

  • Unit Linked Endowment plans:

    These are fixed-term endowment plans curated for the high-risk takers and who expect a high return on investment. The money invested in these plans is further bifurcated into two parts- one who is invested as insurance to cover for the death or any contingency towards the insured, and the other as an investment fund which is directly invested into a market-linked fund. The second option gives returns based on the performance of the market and the entity in which the funds are invested. Since the risk constituent is high in these investments, so even the return on investment (that is directly proportional to the risk) is also high.

  • Full or with Profit Endowment Plans

    These plans and policies ensure a death benefit, which is equal to the basic sum assured, and this amount is guaranteed since the inception of the policy. The final amount that is paid out is competitively higher than expected as it also included additional bonuses that the insured may have earned in the entire tenure of maintaining his policy. So eventually, the maturity benefit comprises the basic sum assured plus additional bonuses earned during the tenure of the insurance plan.

  • Low-Cost Endowment Plans

    This is a lucrative investment option that guarantees a fund that can be utilized by the insured for meeting his financial goals and emergencies. The maturity amount will be paid out after a specified amount of time which can be used as a retirement benefit or in meeting long-term expenses, even in writing off a debt that the insured may have taken. In case of the death of the insured, the basic sum assured will be given to this nominee or beneficiary as a death benefit. 

  • Non-Profit Endowment Plans

    This is a simple plan curated for the non-risk takers and even the premium to be paid towards his plan is lower as compared to other policies. Here, all that matters is the basic sum assured which is paid out to the insured either on maturity or to his beneficiaries in case of his death.

  • Guaranteed Endowment Policies

    These policies may or may not consider additional bonuses, but a specified amount will be surely guaranteed as payment to be given to the insured on maturity and end of the policy tenure or as a death benefit to his nominees in case of his death. Bonuses under this plan are not guaranteed, but the face value - a certain sum of money is paid out in both conditions. This is a combination of guaranteed benefits of an endowment plan plus the non-guaranteed bonus which the insured may or may not earn during the tenure of the plan.

How does an Endowment Plan work?

Below mentioned are the various steps that are followed for the efficient working of an endowment plan:

Step 1 - The insured buys an endowment plan with selective coverage based on basic sum assured, premium paying term, and coverage term. The premium is calculated on the parameters mentioned.

Step 2 - If investments are made in a participating plan, then bonuses earned will be calculated and declared by the company. There could be other benefits too, as interest, return on investment, and other bonuses that can be earned and calculated.

Step 3 - In case of the death of the insured, a lump-sum amount, which could be the basic sum assured plus any bonuses he may have earned during the entire tenure of the policy, is paid out to the nominee or the immediate family of the insured.

Step 4 - In case of maturity pay-out, a basic sum assured plus any bonuses he may have earned during the entire tenure of the policy is paid out as maturity benefit to the surviving insured.

Key Features of an Endowment Plan

To achieve life goals and to make sound investments in life that pay out a guaranteed amount of savings either to the policyholder or to his family, one must invest in an endowment policy. Let us look at the salient features offered by endowment plans:

  • These plans offer a comprehensive death benefit and a maturity benefit which is guaranteed based on the basic sum assured. The benefit can increase if the bonuses earned(if any) are cumulated with the final amount to be paid out.
  • The returns guaranteed by an endowment plan are much higher as compared to a pure life insurance policy. These could be risk-taking plans or simple plans, but every policy ensures a guaranteed and a high rate of return.
  • The premium payment tendency is customized as per the preference of the insured and can be paid out on a monthly, quarterly, half-yearly, or annual basis as it suits the policyholder. Online and offline payments towards premium payment can also be made. The policyholder also has the option to opt for the regular premium, limited premium, or single premium policies.
  • Flexibility while purchasing an endowment plan is ensured as various riders can be additionally purchased and combined with the original policy cover like critical illness, personal accident, and disability, or a minimum premium payment plan, which can be taken up.
  • Tax deductions and exemptions under section 80C and 10(10) D can be availed by investing in endowment plans. *Tax benefit is subject to changes in tax laws.
  • These are much safer investment plans than directly investing in market-linked investments like mutual funds, shares, and stocks and it guarantees a fixed amount of payment at maturity or death even if the market is not performing. So, it has a low risk as compared to other investment options.
  • These are long-term policies that can go as long as 30 years and can be sufficiently used for retirementbenefits or meeting long-term financial goals like the higher education of children or their marriage. There are many plans which provide exclusive coverage until the policyholder reaches the age of 99 or 100 years, so a safe retirement option can be seen in these plans.
  • The money invested in endowment policies is not further invested in capital markets, a bonus may accrue depending on the performance of the insurance company and will be added (if earned) to the final maturity amount, so a basic amount on maturity or death is guaranteed and the higher amount can be expected in the hope of a high bonus as earned through the performance of the insurance company.
  • Only the participating plans ensure bonus additions to the corpus of the endowment plans if the insured is making payments towards the premium whenever they are due. Loyalty or Guaranteed additions could be added to the lump sum amount under many endowment plans.
  • One the relationship between the insured and the insurer is established, a loan can be availed in case of financial emergencies by the policyholder on the surrender value of the endowment plan. This can be taken only after maintaining a minimum 3-year relationship with the insurance company with the regular payment of premium towards the plan.
  • Under the Endowment Policy, the policyholder can earn both - Simple Reversionary Bonus and Terminal Bonus which are further added to the basic sum assured. The cumulative amount is paid out on death or maturity. Simple Reversionary Bonus is announced every financial year and is added on to the sum assured. Terminal Bonus a type of loyalty bonus that will only be paid out at maturity of the endowment plan.
  • Endowment plans are Zero risk policies, and the fund or corpus accumulated is safe and sound as long as the policyholder is paying his dues and premiums on time. There is no risk attached to the basic sum assured as covered under the plan.

Core Benefits of Investing in Endowment Plans

There are various advantages of investing in endowment plans like:

  • Life Insurance Benefit or Death Benefit

    An assured and guaranteed lump-sum amount will be paid out to the family/beneficiaries/nominee of the insured as a death benefit in case of his demise within the tenure of the endowment plan. There is no risk attached, and bonuses may or may not be covered as earned by the policyholder. There is no risk in this investment, and no variation can be made in the death benefit.

  • Maturity Benefit

    In case of the survival of the policyholder, again the basic sum assured as covered under the endowment policy will be paid out to the insured after a specified tenure as it was fixed initially. If during the tenure, the insured continues to pay his premiums diligently and does not falter on his payments; the sum assured remains safe and is paid out. This final pay-out can also be higher than expected if any loyalty or reversionary bonuses have been earned by the insured during the tenure of the plan. The maturity benefit depends on various factors like policy tenure, policy premium and the term for premium, the age of the policyholder and his gender.

  • Investment Benefit

    Endowment policies also give the option of building an investment corpus for the investor who wants to invest his funds in market-linked equities and mutual funds. In this case, the premium paid towards the endowment policy is divided into two parts out of which one part is kept for the insurance and the other is used to invest further. These could be high-risk investments but also ensure a high rate of return.

  • Tax Exemption Benefit

    Tax benefits can be earned at the inception stage of the policy when it is bought, accumulation stage that while the policy is going on and the premiums are being regularly paid towards it and, and also the maturity stage, as many endowment policies come with a tax benefit on the maturity amount. This is all covered under section 80C and 10(10)D of the Indian Income-tax Act, 1961.*Tax benefit is subject to changes in tax laws.

  • Loan Benefit

    After maintaining a relationship with the insurance company and after paying the annualized premiums regularly for a minimum of three years, the surrender value will be generated on the endowment plan. In the case of financial emergencies, 90% of this surrender value can be taken as a loan with a substantially low rate of interest and can be paid out during the tenure of the policy. If the insured fails to pay the loan amount, the pending amount will be deducted from the maturity or the death benefit as the case may be.

  • Bonuses Earned

    In the case of a with-profit endowment plan, the policyholder can also share in these profits. Depending on the surplus funds and the profitability of the insurance company, payment of bonus can be availed by the insured on his amount invested which is paid out to him at maturity or death, This bonus given by the insurance company is calculated after deducting relevant claims, costs, and expenses, costs, for a particular financial year.

    The benefit of a Lump sum pay-out on death or maturity.

    Low-Risk Investments and long-term savings can be ensured by investing in endowment plans which come with a policy tenure variation of 10, 15, 20, 30, or 40 years.

Additional Riders of the Endowment Policies

Additional riders Provide and customized as per the preference of the insured, which are discussed as under:

Optional Riders with an extra payment of premium that are available under the Endowment Plan are as follows:

  • Critical Illness Rider

    The policyholder will get a lump sum amount or other benefits as mentioned in the terms and conditions of the policy document if he is diagnosed with a critical illness like paralysis, kidney or lung failure, cancer, heart attack, etc.

  • Accidental Death

    On paying an extra premium, the policyholder can buy this rider which will increase the death benefit as the additional rider benefit will be added to the sum assured of the endowment plan and thus an enhanced sum of money will be paid out to the family of the insured in case of his unfortunate and accidental death.

  • Disability

    This is a highly beneficial option for people, and this provides financial support either in the way of the lump-sum amount or a monthly amount if the policyholder suffers from a partial or total disability.

  • Waiver of Premium

    This is a crucial rider and proves to be quite beneficial in the long run, if the policyholder has a permanent disability or a critical illness, besides receiving the sum assured benefits, he will also not be required to pay the premium on the remaining tenure of the policy.

  • Hospital Cash Benefit

    Benefits like Hospital Cash ensures a daily cash allowance and other benefits like pre and post hospitalization in case the policyholder is hospitalized for any reason.

Key Factors to Consider before Buying an Endowment Plan

There are certain factors to consider before investing in endowment plans like:

  • One should Start Planning Early for the Investments

    The earlier, the better as it generates a higher amount of corpus and a much higher return on investment. It also enhances the number of years of income generations, thus increasing the tenure of investment. This enables disciplined savings.

  • Always Select an Endowment Plan with Additional Riders

    As discussed, there are many riders or other coverage that the policyholder can buy while investing in an endowment plan. They have their exclusive inbuilt features out of which the applicant can derive maximum benefit. Other benefits like double endowment policy, education endowment, or even a marriage endowment are lesser-known riders that can give better prospects.

  • Always choose the Flexible Plan as per your Income

    Endowment plans come with a single premium, limited premium, and regular premium endowment plans. This can be modified and chosen as per the income earned. If a person gets regular salaries, he can go for the monthly payment of premiums and thus can choose a regular premium plan. People with inconsistent business or irregular salaries can choose a single payment (lump-sum) or limited premium policies.

    Before investing, one must consider if he wants to go for the guaranteed or non-guaranteed returns option. Suppose the policyholder does not want to take higher risks in the already low-risk endowment policy, which further provides a dual benefit of insurance and investment. In that case, he can simply invest his funds and simply claim the death or the maturity benefit as the case may be. But the insured also has the option to invest his funds' in mutual funds or market-linked securities like equity and stocks, for which the returns are not guaranteed but return on investment will be high depending on the performance of the market.

  • Thorough Knowledge of Bonuses is a Prerequisite

    Depending on the performance of the insurance companies, bonuses like loyalty bonuses and reversionary bonuses can be paid out. So, transparency between the company and the policyholder should be thoroughly maintained, and the status of bonuses earned should be clear. These bonuses, depending on the valuation of its assets and liabilities, when earned, are declared at the end of each financial year and are added to the existing corpus of the policyholder.

  • Premium Paid towards the Policy

    Another important factor to consider is the premium to be paid towards the policy. It should be well within the budget and should be affordable.

  • Policy Term

    The policy term and tenure of the endowment policy should be considered before investment which should be well within the investment horizon. Keeping a long term financial goal in mind, the term should be chosen so that it can be met at the maturity of the policy.

  • Regular Premium Payment

    If the policyholder goes for a participating plan, he must pay all his premiums regularly to avoid any kind of lapse of the policy. This can adversely affect the bonuses earned, which will only be paid out if the premiums are paid regularly.

  • Lapsed Policy

    If the policy gets lapsed, it can be further revived, including a better and wider scope of coverage and options.

  • Claim Settlement Ratio and Smooth Claim Process

    The policyholder needs to consider the claim settlement ratio, incurred claims ratio, and the claim process before investing his hard-earned income in the insurance company. The companies should have an online process handy that can help them go through a smooth process in case of any claims.

  • Financial Stability of the Insurance Company

    The insurance companies who possess an independent authorization of financial stability and strength, have better prospects and thus attract maximum investments from the people of the country.

Who should Buy Endowment Plans?

An endowment is for anyone and everyone interested in both the purposes - investment and insurance. It could be for a young fresher or an old senior citizen. Several financial objectives need to be achieved in everyone's life, and he must be ready to achieve these goals. Endowment plans are suggested to people who: 

  • Want to invest their income in a plan that has low risk and who is looking for both investment and insurance.
  • Want to invest in endowment plans keeping in view their long-term goals and want to earn a lump-sum maturity amount.
  • Want to save small bits of money over a long tenure and earn tax benefits, a good maturity amount with the low-risk factor.
  • Don’t want to take any kind of risks and want a sure shot assured maturity or death benefit arising out of their investments.
  • Want to invest in market-related funds, take some risk, and earn a higher return on investments.

Best Endowment Plan offered by Different Insurance Companies

*Paisawiki does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

Endowment Plans

Min and Max-Age of entry

Min and Max-Age of Maturity

Term or Tenure of the Policy

Mode of Premium Payment

Minimum Basic Sum Assured

Maximum Basic Sum Assured

Premium Paying Term

Aviva Dhan Nirman Endowment Plan

4 years to 50 years

28 years to 75 years

18 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 200000

Rs. 10000000

14 years to 18 years

AEGON Life Premium Endowment Plan

18 years to 55 years

18 years to 60 years

Policy Term to 10 years

Annually, Bi-Annually, or Monthly

10 times of annualized pay

Not Applicable

8 years

BSLI Vision Endowment Plan

1 year to 55 years

Not Applicable

20 years

Annually, Bi-Annually, or Monthly

Rs. 1 lakh

No Upper Limit

7 years to 10 years

Bajaj Allianz Endowment Plan

1 year to 60 years

18 years to 75 years

15 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 1 lakh

No Upper Limit

5 years

Bharti AXA Life Elite Advantage Endowment Plan

6 years to 65 years

75 years for a 10-year policy and 77 years for a 12-year policy.

10 years to 12 years

Annually, Bi-Annually, Quarterly or Monthly

Depends on the amount of premium paid

5 years for a 10-year policy

Exide Life Jeevan Uday Endowment Plan

0 years to 55 years

70 years

10, 15, 20 years

Annually or Bi-Annually

Rs. 42000

No Upper Limit

10 years

Future Generali Assure Plus Endowment Plan

3 years to 55 years

70 years

15 to 20 or 25 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 1 lakh

No Upper Limit

7, 10, 12, 15, 17 or 20 years

HDFC Life Sampoorn Samridhi Plus Endowment Plan

 30 days to 60 years

18 years to 75 years

15 years to 40 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 65463

No Upper Limit

35 years

HDFC Life Endowment Assurance Endowment Plan

18 years to 60 years

18 years to 75 years

10 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Not Applicable

Not Applicable

10 years to 30 years

ICICI Pru Savings Suraksha Endowment Plan

0 years to 60 years

70 years

10 years to 13 years

Annually, Bi-Annually, or Monthly

Depends on the age factor of the policyholder and is calculated as 10 times the annual premium paid

Either equal to the policy term OR 5, 7, 10 or, 12 years

IDBI Federal Endowment Plan

18 years to 55 years

18 years to 100 years

Pay-out period plus premium paying term.

Annually, Bi-Annually, Quarterly or Monthly

Rs. 10000

No Upper Limit

12 years to 30 years

IndiaFirstMaha Jeevan Endowment Plan

5 years to 55 years

70 years

15 years to 25 years

Annually, Bi-Annually, or Monthly

Rs. 50000

Rs. 20000000

Equal to the term of the endowment plan chosen

Jeevan Nivesh Endowment Plan

18 years to 55 years

Not Applicable

10 years to 30 years

Annually or Monthly

Rs. 3 lakhs in annual mode and Rs. 5 lakhs in Monthly mode

No Upper Limit

5, 7 or 10 years

Kotak Classic Endowment Plan

8 years to 60 years

18 years to 75 years

15 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 61071

No Upper Limit

7 years to 15 years

Kotak Premium Endowment Plan

18 years to 60 years

18 years to 70 years

10 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 61317

No Upper Limit

10 years to 30 years

LIC New Endowment Plan

8 years to 55 years

0 years to 75 years

12 years to 35 years

Annually, Bi-Annually, Quarterly or Monthly

Paid in multiple of 5000 - Rs. 1 lakh

No Upper Limit

12 years to 35 years

Max Life Whole Life Super Endowment Plan

18 years to 60 years

Not Applicable

10 years to 22 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 50000

No Upper Limit

10, 15  or 20 years

MetLife Bhavishya Plus Endowment Plan

20 years to 45 years

69 years

12 years to 24 years

Annually, Bi-Annually, or Monthly

Rs. 92320

Rs. 5 lakhs

Equal to the term of the endowment plan chosen

Pramerica Roz Sanchay Endowment Plan

8 years to 50 years for a 16-year policy and 45 years in the case of a 21-year policy.

66 years

16 years to 21 years

Annually, Bi-Annually, or Monthly

Rs. 10000 for a 16-year policy and Rs. 2 lakhs for a 21-year policy

Rs. 5 crores

12 years for a 16-year policy and 16 years for a 21-year policy

Reliance Nippon Life Super Endowment Plan

8 years to 60 years

22 years to 75 years

14 years to 20 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 1 lakh

No Upper Limit

7 years to 12 years, which will be equal to half of the policy term chosen

Reliance Life Insurance Super Endowment Plan

8 years to 60 years

22 years to 75 years

14 years to 20 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 10000

No Upper Limit

7 years to 12 years

Reliance Endowment Plan

5 years to 50 years

18 years to 60 years

10 years to 25 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 65261

No Upper Limit

10 years to 25 years

Single Pay Endowment Assurance Plan

8 years to 50 years

60 years

10 or 15 years

Single Pay

Rs. 4 lakhs

No Upper Limit

Single

Sahara DhanSanchay Endowment Plan Jeevan Bima

14 years to 50 years

70 years

15 years to 40 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 50000

No Upper Limit

Equal to the term of the endowment plan chosen

SBI Life Smart Bachat Endowment Plan

8 years to 55 years

65 years

10 years to 25 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 1 lakh

No Upper Limit

5, 7, 10, and 15 years

Shriram New Shri Life Endowment Plan

30 days to 65 years

75 years

10 years to 25 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 50000

No Upper Limit

5 years to 25 years

SUD Life Jeevan Super plus Endowment Plan

18 years to 55 years

70 years

13 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 3 lakhs

Rs. 100 crores

Equal to the term of the endowment plan or a maximum of 10 years

SBI Life Endowment Plan

18 years to 60 years

18 years to 60 years

5 years to 30 years

Annually, Bi-Annually, Quarterly or Monthly

Rs. 75000

No Upper Limit

Single for minimum premium tenure and 30 years for maximum premium tenure

TATA AIA Insurance Fortune Guarantee Endowment Plan

8 years to 55 years

65 years

10 years

Annually, Bi-Annually, Quarterly or Monthly

10 times the annualized premium

5 years

What is not Covered under these Plans? - Key Exclusions under Endowment Plans

The following are the key exclusions of endowment plans:

  • Intentional self-inflicted injury or an attempt to commit suicide not covered
  • Death or disability under the influence of banned drugs or intoxication will not be considered
  • Nuclear attacks, terrorist attacks, war, or invasion not covered
  • Participation in hazardous sports or adventure games not covered
  • Participation of the policyholder in any illegal or criminal activity, any kind of claims arising out of the same will be excluded

Tax Benefits under Endowment Plans

*Tax benefit is subject to changes in tax laws.

Tax Exemptions under section 80C of the ITA, 1961

To claim deductions:

  • The maximum limit is permitted up to an amount of Rs. 1.5 Lakh available for individuals and HUFs on the premium paid for self, husband/wife, dependent children, and dependent parents.
  • If the endowment plan was purchased before 1st April 2012, the premium paid should not exceed 20% of the sum assured else no exemptions would be provided on the excess amount paid.
  • If the endowment plan was purchased after 1st April 2012, the premium paid should not exceed 10% of the sum assured.
  • If the plan is taken for a disabled person as defined under section 80U of the Income Tax Act, 1961, or is the insured is suffering from a critical illness as specified under section 80DDB of the Act. This policy is purchased after 1st April 2013; the premium paid should not exceed 15% of the sum assured.
  • No tax deductions will be allowed if the premium is paid for a deferred annuity plan

Tax Exemptions under section 10(10)D of the ITA, 1961

To claim deductions:

  • The sum assured plus bonuses, loyalty, and guaranteed bonuses are taken into consideration
  • If the endowment plan was purchased before 1st April 2012, the sum assured should be 5 times the total amount of premium paid
  • The death benefit would be completely tax-free whatever the sum assured
  • If the endowment plan was purchased after 1st April 2012, the sum assured should be 10 times the total amount of premium paid
  • The policy should not be a Keyman insurance policy and should not be under the provisions of Section 80DD (3)

Eligibility Criteria for Endowment Policy

The parameters vary with each endowment policy, under many, the policyholders must declare their existing illnesses if any and each plan has different features which are:

Minimum age of buying the endowment plan

0 years to 60 years

 

Minimum age of procuring the plan at the time of maturity

18 years to 100 years

The ability to pay the premium for the selected plan

Yes

Steps to Buy an Endowment Policy Online

Endowment policies can be bought through both - offline and online methods.

Offline policies can be bought through intermediaries and insurance agents directly by visiting the nearest branch of the insurance company.

Buying an online policy is much easier and convenient, and it offers a thorough investigation and research on the various plans available in the market.

The following steps should be followed to purchase an online endowment policy:

Step 1 - The applicant can visit the official website of the insurance company, or he can visit paisawiki.com to purchase the plan.

Step 2 - The applicant needs to identify his purchasing need of the endowment plan - if it is for investment and tax planning or if it is for savings.

Step 3 - After selecting the plan to be purchased, he would need to enter his details like his gender, age, annual income, any existing diseases, smoking habits, investment horizon, premium payment option, investment amount, contact details, etc.

Step 4 - The applicant needs to select from ULIPs and traditional plans and select the required benefits and premiums to be paid.

Step 5 - the individual can compare various available plans and policies and choose the best endowment plan under his needs for the required coverage.

Documents required to Purchase an Endowment Plan

The applicant would need to submit the following documents to purchase the endowment policy:

  • Photographs of the applicant and photographs of other insured members if it is being bought for other family or non-family members
  • Identity proof of the insured like submission of Aadhar Card, Voter ID card, passport, etc.
  • Address Proof like Utility bills, rent agreement, Aadhar card, passport, driving license, etc.
  • Age Proof-like birth certificate, passport, Aadhar card, 10th or 12th mark sheet, voter ID Card, PAN Card, etc.
  • Income Proof-like bank statements, salary slips, ITR Returns, Form 16, and other relevant documents
  • A copy of the Aadhar Card and PAN Card

The Claims Procedure for Endowment Plans

To process the claims of an endowment policy, the applicant must follow these relevant steps:

Step 1 - As soon as the claim arises, the insured must fill in the claims form appropriately, which is either available on the website or can be availed from the agent. It should be properly filled and submitted to the insurance company.

Step 2 - All the relevant documents that would need to support the claim should be attached to the claims. For example, in case of death, the death certificate of the policyholder needs to be attached, and the nominee would need to submit his details like his identity and address proofs.

In the case of maturity claims, the process is fairly easy as the insurance company sends a reminder to the policyholder about the upcoming claim. All the applicant needs to do is, is to confirm his identity through proper documentation, fill in the voucher, and discharge from sent by the insurer and return the original policy document. A cancelled cheque or a copy of the passbook which contains the relevant bank account details of the insured needs to be submitted to the insurance company.

Step 3 - After receiving the claims form, a confirmation will be sent by the insurance company.

Step 4 - The claims department of the insurance company will review the application and will investigate the documents attached and approve the claim if everything is thoroughly verifying.

Step 5 - The policyholder will receive constantly updated on the status of the claims on his registered email and mobile number.

Step 6 - After the required verification and approval process, the disbursement of claims will be electronically transferred to the account of the nominee or the account holder. The timeline to process the disbursal of claims varies from one insurance company to the other.

Step 7 - In the case of rejection of the claim, the same will be specified in a rejection letter along with the reason for the denial of the claim.

Comparison between Endowment Plans, Term Plans and ULIPs

Let us look at the main points of difference among all three Insurance Plans:

*Standard T&C Apply.

Features

Endowment Plans

ULIPs

Term Insurance

Insurance Protection

Life Coverage plus Investment Plan

Life Coverage plus Investment Plan

Only Life Coverage

Premium Paid

High

Higher

Low

Maturity Benefit

The Death benefit and basic sum assured plus bonus on maturity

Units will be redeemed after the maturity as per the prevailing rate

No maturity benefit unless a rider of the same has been additionally applied and paid for

Risk Factor

No-Risk

High Risk

No-Risk

Return on Investments

Medium

High

Not Applicable

Transparency

Not Applicable

The policyholder can keep track of the market portfolio invested in

Nothing to keep track of

Tax benefits

Available u/s 80c and 10(10)D

Available u/s 80c and 10(10)D

Available u/s 80c and 10(10)D

Flexibility

No flexibility provided in the investment plan

Can change the investment strategy by switching funds

Only add-ons and riders available - No flexibility in the main plan

Comparison between Endowment Plans and Mutual Funds

Some of the main points of difference between both the available plans are:

Features

Endowment Plans

Mutual Funds

Insurance and Life Coverage

They constitute a life coverage plan

This is a pure investment policy with no contingency of insurance or life coverage

Investment of funds

The funds don’t need to be are mandatorily invested in market=linked instruments like debts, equities, share, and stocks

These are market-linked investments and funds are invested in debts, stocks, shares, or equities

Return on Investment

Returns offered are lower than mutual funds as the risk factor is low too.

The Risk factor is higher, and so are the returns on investments as compared to endowment plans.

Risk Factor

These are risk-free investments

A certain level of risk is attached to these kinds of investments

Administrative Costs

Endowment Plans have lower administrative costs

Administrative Costs are higher in the case of mutual funds.

Tax Relief

Tax reifies provided on both - premium paid towards the policy and the benefits acquired (death plus maturity)

Tax relief is provided only on the funds that are invested. Long term capital gains are not tax-free.

Comparison between Endowment Plans and Money-Back Plans

Points of difference between both the plans are:

*Standard T&C Apply.

Features

Endowment Plans

Money-Back Policies

Insurance and Life Coverage

They constitute a life coverage plan

They constitute a life coverage plan

Maturity Benefits

Maturity benefits are offered at the end of the policy tenure

Maturity benefits are offered at the end of the policy tenure

Survival Benefit

No survival benefit in many endowment plans

Survival benefit is offered to the policyholder after completion of a specified number of years at particular intervals

Additional Bonuses

Maturity Benefits include the additional bonuses earned

In accordance with the terms and conditions of the policy, money-back policies also have certain bonuses which are attached to the maturity benefits

Tax Relief

Tax relief provided on both - premium paid towards the policy and the benefits acquired (death plus maturity)

Tax relief provided on both - premium paid towards the policy and the benefits acquired (death plus maturity)

Some of the Endowment Plans in India

*Standard T&C Apply

  • HDFC Life Jeevan Sanchay Plus

    This endowment plan is a non-participating policy that has the following features -

    The policyholder can choose to receive the maturity benefit as a lump-sum amount or in instalments. There are 4 benefit payment choices under the plan. 

    Maturity benefits can be earned until the policyholder turns 99 years of age and can receive benefits as a life-long investment.

    Guaranteed additions and bonuses are accumulated under the policy.

    To retain and gauge a wider scope of coverage, the policyholder gets the choice of adding two optional riders to be accumulated along with the existing endowment plan. 

    The eligibility criteria under this policy are as follows:

    Entry Age

    5 to 60 years

    Term of Policy

    6 to 20 years

    Term of Premium Payment

    5 to 12 years

    Minimum Premium to be paid

    Rs. 30000 per annum

    Maximum Premium to be paid

    Unlimited

    Basic Sum Assured

    Depends on age, gender, the premium paid, and the plan opted for.

  • ICICI Pru Cash Advantage

    Cash Advantage is a money-back plan in which the insured has the option of paying his sum assured over a specified term of the policy, and it can be conveniently paid in instalments. The best features of this plan:

    Premiums are paid only for a limited period 

    1% of the Guaranteed Maturity Benefit is an insured amount that will be paid throughout the policy term as Guaranteed Cash Benefit

    After the premium payment term is completed, regular incomes are paid out for 10 years 

    The eligibility criteria under this policy are as follows:

    Entry Age

    0 to 60 years

    Term of Policy

    15, 17 or 20 years

    Term of Premium Payment

    5,7 or 10 years

    Minimum Premium to be paid

    Rs. 30000 per annum

    Maximum Premium to be paid

    Unlimited

    Basic Sum Assured

    7 or 10 times of the premium paid on a yearly basis, depending on the age of the policyholder.

  • ICICI Pru Savings Suraksha

    This is another endowment plan which gives the choice of both- a regular premium payment plan and a limited premium payment option, offered by ICICI Prudential.

    The best features of this plan:

    The plan helps you grow the financial corpus through an added reversionary bonus, and it is also a participating endowment plan.

    During the first 5 years of the policy, guaranteed additions are also amalgamated into the plan.

    The eligibility criteria under this policy are as follows:

    Entry Age

    0 to 60 years

    Term of Policy

    10 to 30 years

    Term of Premium Payment

    5 to 30 years

    Minimum Premium to be paid

    Rs. 12000 per annum

    Maximum Premium to be paid

    Unlimited

    Basic Sum Assured

    7 or 10 times of the premium paid on a yearly basis, depending on the age of the policyholder.

  • LIC’s Jeevan Labh

    LIC is well known for offering some of the best endowment plans out of which LIC Jeevan Labh is popular as one such plan which gives the benefit of payments of the limited premium only. The best features of this plan:

    Bonuses are ensured and declared under the plan which gets accumulated in the death or maturity benefit and paid out at the end of the policy term.

    The policyholder can select two optional rider coverage benefits.

    Premium discounts are available to an applicant who chooses a basic assured policy of Rs. 5 lakhs and above 

    The eligibility criteria under this policy are as follows:

    Entry Age

    8 to 59 years

    Term of Policy

    16, 21 or 25 years

    Term of Premium Payment

    10, 15 or 16 years

    Minimum Premium to be paid

    Depends on the sum assured, age and the tenure of the selected policy

    Maximum Premium to be paid

    Unlimited

    Basic Sum Assured

    Rs. 2 lakhs

  • LIC’s Jeevan Tarun Plan

    LIC’s Jeevan Tarun Plan is invested in safeguarding the financial future of the child with respect to his higher studies and other mandatory expenses which need to be paid for his education. This plan doubles up as a child insurance plan and acts as the best endowment policy for your child. The best features of this plan:

    The parent is the policyholder, and the children are covered under the plan. 

    There is the following coverage under the plan:

    • The insured can choose to retrieve the sum assured in money back benefits.
    • A portion of the sum assured needs to be paid out in the last 4 policy years if the money-back benefit is opted for.
    • Bonuses are added under the plan.
    • The policyholder can additionally buy a premium waiver rider by paying an additional premium. If the premiums are paid on an annual or a bi-annual basis, then Premium discounts or savings are available.

    The eligibility criteria under this policy are as follows:

    Entry Age

    90 days to 12 years

     

    Term of Policy

    25 years - entry age

     

    Term of Premium Payment

    20 years - entry age

     

    Minimum Premium to be paid

    Depends on the sum assured, age and the tenure of the selected policy

    Maximum Premium to be paid

    Unlimited

    Basic Sum Assured

    Rs. 75000

  • Reliance Endowment Plan

    Sum assured plus consigned bonuses on maturity are paid out based on 100.1% of payment of premiums towards the plan. Death Benefit is 10 times the base sum assured plus the vested bonuses or the annualized premium. The Policy term is from 10 years to 25 years.

    The loan against the policy is available on the surrender value after the completion of a certain number of years.

  • Kotak Classic Endowment Plan

    This is a participating endowment policy that provides life insurance coverage of up to 75 years of the life insured. From the very first year onwards, annual bonuses will be applicable. There is a wide range of term and tenure options.

    Tax Benefits under sections 80c and 10(10)D of the Indian Income Tax Act, 1961.*Tax benefit is subject to changes in tax laws. To enhance the level of protection and insurance, additional riders can be bought and attached to the main policy.

  • Kotak Premier Endowment Plan

    During the first 5 policy years, the policyholder receives 5% per annum as Guaranteed Additions, which is calculated based on the Basic Sum Assured. From the 6th policy year onwards, bonuses accrue and can be further accumulated with the main corpus. Different term combinations, in the form of regular premium paying or limited premium paying terms for 5, 7, 10, or 15 years are applicable.

    There is a total of 7 additional riders that can be purchased and combined with the existing policy coverage.

The Endowment Plans with Maximum Benefits

*Paisawiki does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

*Tax benefit is subject to changes in tax laws

*Standard T&C Apply

Name of the Endowment Plan

Term of the Endowment Plan

Policy Paying Tenure

Guaranteed Additions (Loyalty)

Earned Bonus

Features

Rebates, Discounts, and Savings

Aegon Life Insurance Insurance Plan - Endowment

10 or 15, or 20 years

5, 10, 15, 29 years for Single

5% of the basic sum assured it will be added towards the end of the policy term for the whole premium payment tenure, which is 5 years in case of a single premium.

 

The collected fund will be paid out along with the maturity amount by the end of the term.

Terminal bonus, interim bonus, and the simple reversionary bonus will be applicable.

The Policyholder can choose his policy term.

 

Maturity benefit paid out in lump-sum.

 

Premium payment options are flexible.

 

Bonus accrual since the very first year of the policy which will increase the benefit amount each year.

Not Applicable

Bajaj Allianz Elite Assure Endowment Insurance Plan

15 to 30 years

7 or 10 years OR Regular Pay

From the end of the 10th year, 3 - 15% of the guaranteed maturity benefit will be paid out.

A terminal bonus, interim bonus, and a simple reversionary bonus will be applicable.

The option of 5 additional riders is available.

 

The policyholder can change the frequency of premium payment.

Premium discounts and savings applicable to choosing guaranteed maturity benefits of Rs. 5 lakhs and more.

HDFC Life Sampoorn Samridhi Plus Endowment Insurance Plan

15 to 30 years OR in case of whole life plans - 100 years

Plan term minus 5 years

For the first 5 years, 5% of the basic sum assured on maturity

From the very first year, a terminal bonus, interim bonus, and a simple reversionary bonus will be applicable.

The additional sum assured will be paid out in case of accidental death as this plan has an inbuilt accidental death benefit included.

Rebates and savings available on basic sum assured amounts of Rs. 1.5 lakhs and above.

IndiaFirst Simple Benefit Endowment Insurance Plan

15 to 25 years

Equal to the term of the policy

Towards the ending period of the policy, a guaranteed sum assured as maturity benefit plus terminal bonus plus simple reversionary bonus will be paid out.

Terminal Bonus and a simple reversionary bonus is available under this plan.

Loan facility available up to 90% of the surrender value of the policy.

 

Regular contributions from the person’s income can help him build a good corpus which will help him deal with financial emergencies.

 

Flexibility to choose the basic sum assured amount.

 

Tax benefits can be obtained, which are based on the amounts of premium paid towards the plan and of any benefits that have already been availed in the policy.

Rebate is forbidden under this plan in any form.

Kotak Classic Endowment Insurance Plan

15 to 30 years

In case of regular pay - equal to the term of the policy.

 

In case of Pay - 7 years in case of policy term - 15 years term of policy minus 5 years.

Guaranteed surrender value is obtained in the plan, which depends on the premium payment term that is chosen, and the number of premiums paid.

Interim Bonus, simple reversionary bonus, and Terminal bonus are available under this plan.

Up to the age of 75 years - comprehensive coverage of protection is provided.

 

The policyholder can use the flexibility factor or premium paying options as per his affordability.

 

The bonus can be earned from the very first year of the policy.

 

Multiple rider options available through which the policy can be enhanced.

 

A myriad of term options available to opt for.

 

Premium discount or savings are available valid for the basic sum assured of Rs. 5 lakhs or more on reaching maturity of the plan.

LIC’s Jeevan Rakshak Endowment Insurance Plan

10 - 20 years

Equal to the term of the policy

After completion of 5 years, the loyalty bonus is paid out

The final addition bonus and a vested bonus is also paid out

By paying an additional payment, LICs accident benefit riders can also be purchased.

Modal discount or savings on annual and bi-annual payment of premium at the rate of 2% and 1% respectively.

 

Another discount or savings in the form of high sum assured I premiums for a minimum level of Rs. 1.5 lakhs are also provided.

MaxLife Gain Premier Endowment Insurance Plan

15 to 25 years

6, 8, 10, or 12 years

Not Applicable

Bonus is declared from the 2nd policy year which can be retrieved in cash. It is used to reduce the subsequent premium or used to increase the sum assured, which can earn future bonuses.

 

A Terminal bonus is also paid out.

The bonus can be withdrawn for emergency purposes provided it is used to enhance the basic sum assured.

 

An inbuilt contingency as a terminal illness benefit through which 50% of the guaranteed maturity benefit is paid on request if the policyholder suffers from any kind of terminal illness.

Not Applicable

PNB MetlfieBachat Yojana Endowment Insurance Plan

15 years

10 years in case of limited pay

The minimum sum assured on maturity is increased by the proportion of the number of premiums paid as compared to the complete number of premiums to be paid.

Simple reversionary bonus and terminal bonus are accessible.

Aid premium towards the plan is eligible for tax benefits.

 

Helps in building long-term savings at budgeted payment of premiums.

 

Coverage available for 15 years and the policyholder needs to pay only for 10 years.

Discount and savings can be implied in case of accrued simple reversionary bonus.

Pramerica Life Roz Sanchay Endowment Insurance Plan

16 - 21 years

In case of a 16-year policy = 21 years.

 

In case of a 21-year policy = 16 years

When the plan initiates, guaranteed maturity benefit at 150% of basic sum assured in addition to guaranteed accrued annual addition is payable at maturity

Offers guaranteed additions of bonus

The policyholder can take a loan against the policy after the surrender value is generated.

 

Allows one to create a saving amount for old age.

 

Comprehensive coverage with enhanced insurance and protection

Not Applicable

Reliance Life Lifelong Savings Endowment Insurance Plan

15 to 30 years

Minimum and maximum age at entry - 7 to 50 years.

 

Regular Pay - 15 to 30 years.

 

Limited Pay - 10 years.

 

For entry age from 51 to 55 years

 

Regular Pay - Not applicable

 

Limited Pay - 10 years

Suppose the policy is active, in the initial 5 years of the plan. In that case, guaranteed additions at the rate of 4% per annum will be calculated regarding the basic sum assured and will be calculated and added towards the end of each policy tenure.

By the end of the policy, in case of survival of the policyholder, the basic sum assured + terminal, and a vested reversionary bonus will be paid out to the policyholder.

The policyholder has the option to pay a premium.

 

In case of emergencies, loans can be availed of these plans.

 

Flexible and additional riders are available and can be purchased along with the plan.

The Discount of the first high sum assured will be implied when the policyholder reaches the final rate of premium.

SBI Life Smart Humsafar Endowment Insurance Plan

10 to 30 years

Equal to the term of the policy as specified

The basic sum assured which was taken up at the inception of the endowment plan is the absolute amount of benefit which is liable to be paid out at the time of death or maturity.

In case of an active policy, during the first three years of the policy, a guaranteed minimum bonus of 2.5 % of the basic sum assured is ensured.

One applicant for both applications.

 

It is a joint policy that provides extensive coverage to both the policyholder and his spouse.

 

 

The insured has the flexibility to choose the term of the plan and to add on rider benefits.

Staff discount or savings is permissible for employees of a bank.

 

Discount or savings are also available on the amount of premium paid per thousand of the basic sums assured.

Single Pay Endowment Assurance Endowment Insurance Plan

10 - 15 years

Single pay applicable only

Sum assured on death and maturity will be made available in this policy

Not Applicable

The policy can be surrendered during the running tenure of the plan.

 

Policy loan can be availed when the policy reaches a surrender value.

 

Many riders like accidental death benefit rider, income benefit rider, critical illness rider, accidental total and permanent disability rider

Not Applicable

Star Union Dai-ichi's Life Jeevan Ashray Endowment Insurance Plan

15 to 20 years

Equal to the term of the policy as specified

Within 15 years of policy term - the guaranteed maturity benefit will be 115% of the basic sum assured.

 

Within 20 years of policy term - the guaranteed maturity benefit will be 120% of the basic sum assured.

 

Not Applicable

Assured benefits guaranteed for the family.

 

Comprehensive coverage for the entire family which can be purchased at customized and low amounts of premium paid

Not Applicable

TATA AIA Insurance Maha Life Gold Endowment Insurance Plan

85 years - Entry age

15 years

Cash dividends paid from the 6th year onwards.

 

Guaranteed annual coupons till 6.5% which are payable from the 11th year of investment onwards till the 30th year.

Not Applicable

There is a facility to have the basic sum assured increase every 15 years till the 45th policy year.

Not Applicable

Investing in an endowment policy is a wise investment decision as it provides an insurance cover along with a savings component to meet long-term goals. It also helps to earn bonuses and guaranteed additions, thus creating more wealth which is available under the plan. Even in the contingency of the death of the policyholder, he may not have to worry about the upbringing of his family, as the insurance factor of these plans will compensate for the same. All one needs to do is, to compare the best endowment plans and policies as available in the market and choose the best one by personal needs, objectives, and requirements.

Endowment Plans - FAQs

  • Q1. What are the different kinds of additional Bonuses associated with the Endowment Policy?

    Ans. There are many kinds of bonuses under endowment plans, and the common ones are:

    • Simple Reversionary Bonus -Until maturity or death, this onus keeps adding up to the corpus. This bonus is based on the sum assured and is calculated annually. It is not compounded and is added as a lump-sum. The pay-out of this bonus will be given at death or maturity.
    • Compound Reversionary Bonus -This is a compounded amount of all bonuses that are received throughout the policy period. Not many insurance companies give this kind of bonus.
    • Interim Bonus -If the policyholder dies or the policy matures before the annual bonus I declared, which is comparatively lower than the annual bonus is Interim Bonus.
    • Terminal Bonus -One-time bonus, which is added to the policy towards the end of the term and added to the death benefit as disbursals are called a terminal bonus.
    • Additional Bonus -Paid in participating policies and includes the profits earned by the insurer in a policy year.
  • Q2. What is the consequence of surrendering an Endowment Policy?

    Ans. If the policyholder, due to any given reason surrenders the endowment policy, before the maturity period, the basic cover plus the added benefits will cease too.

  • Q3. What is a paid-up endowment plan?

    Ans. When the policyholder has paid his premiums due to his endowment policy for three years minimum, the policy can be converted into a paid-up endowment policy. This is beneficial in case the policyholder does not want to surrender the policy, but does not want to make a premium payment. In such a case the maturity amount will be paid, but the amount will be considerably reduced.

  • Q4. Why should one buy an Endowment Policy?

    Ans. There are two perpetual risks faced by any individual - the first risk is pertaining to life and the second is an investment, which is the availability of a corpus that can be useful in case of financial emergencies and in meeting long-term goals. The endowment policy is a dual benefit plan which gives an assured amount of death benefit to the family of the policyholder in case of his death. Besides that, Endowment plans are low-risk savings plans, which help in wealth creation over the policy tenure and help you create investments.

  • Q5. How to choose the best endowment plan?

    Ans. The market is full of various endowment plans and several types of it. An applicant must consider the following factors before choosing the right endowment policy to invest in:

    • Income
    • Needs of an individual’s needs
    • Current life stage
    • Risk appetite
    • The cost of the premium
    • The insurance provider’s track record in claim settlement ratio, bonuses, customer service, and financial status of the insurer
  • Q6. What are the Bonus Rates of the Endowment Policy?

    Ans. The rate of the bonus depends on the insurance and the category of policy bought from it. There is no guarantee on how much the bonus will be specified in a participating unit-linked policy.

  • Q7. What is the Premium Calculator for Endowment Policy?

    Ans. It is a financial tool that can help one to estimate the premium which is required to pay towards the endowment plan to buy that specific policy. The premium calculators are quite simple to use, and the applicant needs to enter his details like age, term, amount as the sum assured, if any additional benefits are taken, etc. and a tentative amount of premium payment will be reflected on the screen.

  • Q8. Is it possible for a policyholder to surrender his endowment policy mid-term?

    Ans. Yes, an endowment plan can be surrendered after a surrender value within the stipulated period of time, of 2 or 3 years has been obtained. The surrender value hugely depends on the policy term and premium payment term. After the policy is surrendered, the policyholder can retrieve his guaranteed surrender value.

  • Q9. Is it possible under an endowment plan to enhance the amount of sum assured?

    Ans. Yes, policyholders can choose to enhance the value of the sum assured, in accordance with the policy terms and conditions. This can be done during the important and crucial stages of one’s life like when the policyholder gets married, has children, higher education of children, and many more situations.

  • Q10. Is it mandatory to get additional riders along with the endowment plan?

    Ans. No, it is not compulsory, but it is suggested to avail of an additional rider to get the maximum benefits over and above the base cover. Riders are additional benefits that enhance the life insurance to meet the individual needs of the applicant. Some of the popular riders are Accidental Total & Permanent Disability Rider, Critical Illness Rider, Term Rider, and Accidental Death Rider. Although the amount of premium payment also increases with the purchase of the endowment plan, these are economical riders and enhance the maturity and death pay-outs with these riders accumulated in the basic cover.

  • Q11. Is it possible for the policyholder to take a loan against his endowment policy?

    Ans. According to the terms and conditions, loans can be availed if the policy has reached its surrender value or cash value. Normally the surrender value is achieved only after 3 years. A certain percentage of the surrender value can be obtained as the loan amount - which is most likely 80% or 90% and varies from one insurance company to the other.

  • Q12. Is it possible to appoint multiple nominees in case of an endowment plan?

    Ans. Yes, there can be more than 1 nominee in an endowment plan, and it is also possible for the policyholder to change the details and appointment of nominees whenever he wants.  Although some insurance companies may have a capping over the number of nominees appointed the number of times that they can be changed.

  • Q13. If under the endowment plan, the policyholder fails to pay his premiums on time, then what are the consequences of the same on the policy?

    Ans. Each insurance company and every policy have their respective guidelines on the rule of termination and policy lapse. Before the lapse takes place, there will be a minimum of 15 days - 30 days grace period after the expiry of the due date. It is highly recommended for the applicant to pay his due payments during this claim period so that the policy remains active and there is no lapse in the policy. If there are any claims during this 30-day grace period, they will not be considered by the insurance company. If still no payment has been made by the insured within the grace period also, it will be considered as terminated policy. Many insurance companies give the leverage of reviving a plan within 6 months by paying the late payment fees and pending premium amount.

  • Q14. What is a free look period in an endowment plan?

    Ans. A 15-day free look period is provided to the policyholders so that they can try and test the purchased policy. If the terms and conditions are not up to the mark and not satisfactory for the policyholder, he can terminate the policy and get a full refund of the premium paid towards it. The insurer will take a nominal charge, but the policy will stand cancelled.

  • Q15. What are the various premium payment channels initiated by insurance companies?

    Ans. The premium can be paid through online and offline modes using cheque, NEFT, RTGS, mobile banking, net banking, or just paying cash through the counters of the nearest branch.

Written By: Paisawiki - Updated: 26 March 2021
Disclaimer: Paisawiki does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.