The endowment policies are also life insurance policies that meet two different needs of the policyholder. It provides both death benefits to the family of the insured if something unforeseen happens and also provides a lump sum after it reaches a certain maturity level based on the term you have chosen if the policyholder survives.
What Is An Endowment Policy?
According to experts, it is one of the best savings plans for all who are trying to save money and get benefits once the maturity level is achieved by acting as a financial shield to protect your money from draining. The policyholder as well as the family will feel secure at the end of the day.
The meaning of an endowment policy is that it is a contract designed to pay a lump sum amount after a particular period that is also termed the maturity of the policy or at the time of the policyholder’s death. The maturity period ranges from five, ten, or fifteen years.
In case of an unfortunate event of the demise of the policyholder during the tenure of the policy, the insurance company provides a sum assured amount that is considered as a death benefit. This amount is paid to the beneficiary or nominee of the insured.
What Is An Endowment Plan In Life Insurance?
As mentioned previously the endowment plans are categorized under life insurance plans offered for people. This endowment life insurance policy gives a dual benefit for the insured by providing insurance coverage and also savings benefits. The insured can save regularly till the policy reaches the maturity limit and can avail of the amount as a one-time lump sum amount.
However, the lump sum is paid only if the insured survives during the policy tenure. In case something unfortunate happens to the policyholder during the policy tenure the amount is paid as a death benefit to the insured’s nominee or the beneficiary of the policyholder.
Different Types Of Endowment Policies
There are five basic types of endowment plans available in the insurance market in India.
- Unit-Linked Endowment Plan
Under this endowment plan, the premium paid by the insured is categorized into different other units that are held under a particular investment fund chosen by the policyholder. It is a fixed-term plan and this savings plan gives the benefit of life coverage as well. People who want to gain much higher returns on investment usually get this type of plan for themselves.
- Low-Cost Endowment Plan
For people who want to save funds for the future, this plan is the best to choose from. The funds will be paid after a particular period in a large amount. People who want to use the money to repay their loans or mortgage etc will find low-cost endowment plans very useful. If the policyholder dies during the tenure of this plan the chosen sum assured will be paid to the beneficiary of the policy.
- Non-Profit Endowment Plan
In this plan, the sum assured is paid to the policyholder as the maturity benefit amount as per the normal procedures. No other benefits are available for this plan.
- Full Profit Endowment Plan
The basic sum assured amount is guaranteed right from the start of the policy activation. This amount is also equal to the death benefit of the policy and it is paid to the insured directly as promised. The final payout is normally higher because it includes the total sum assured and any available additional bonuses.
- Guaranteed Policy Endowment Plan
This plan is more or less the same as the full profit plan but, this plan guarantees the face value of the endowment insurance to be given to the insured on the date of maturity or to the beneficiary of the policyholder in case the policyholder dies. However, the bonus is not guaranteed in this plan. But any other bonuses might be paid too that are not guaranteed. The amount is however guaranteed.
Which Are The Best Endowment Plans In India?
Given below is a list of the top insurance companies in India that provide the best endowment plans to their policyholders:
| Endowment Policies | Policy Term | Minimum Sum Assured | Maximum Sum Assured | Premium Paying Tenure |
| Aviva Dhan Nirman Endowment Policy | 18 – 30 years | Rs20,0000 | Rs10,00,0000 | 14 – 18 years |
| Bajaj Allianz Endowment Policy | 15 – 30 years | Rs 1,00,000 | No Maximum Limit | 5 years |
| Bharti AXA Life Elite Advantage Plan | 10-12 years | Depends on Premium Amount | Depends on Premium Amount | For a 10 year policy it is 5 years. |
| Future Generali Assure Plus | 15-20/25 years | Rs. 1,00,000 | No Upper Limit | 7, 10, 12 ,15, 17 or 20 years |
| HDFC Life Sampoorn Samridhi Plus | 15 years- 40 years | Rs.65,463 | No upper limit | 35 years |
| ICICI Pru Savings Suraksha | 10-13 years | Depending upon the age 10 times of the annual premium | Depending upon the age 10 times of the annual premium | 5,7, 10, 12 years or equal to the policy term |
| Kotak Premium Endowment Policy | 10 – 30 years | Rs61, 317 | No Limits | 10 – 30 years |
| LIC New Endowment Policy | 12 – 35 years | Rs 1,00,000 in multiples of 5,000 | No Upper Limits | 12 – 35 years |
| Max Life Whole Life Super Plan | 10-22 years | Rs. 50,000 | No Limit | 10, 15 or 20 years |
| Reliance Endowment Policy | 10 – 25 years | Rs 65,261 | No limits | 10 – 25 years |
| SBI Life Smart Bachat | 10-25 years | Rs.1,00,000 | No Upper Limit | 5,7,10 and 15 years |
| TATA AIA Life Insurance Fortune Guarantee Plan | 10 years | 10 times the annual premium | 10 times the annual premium | 5 years |
Explore the LIC Endowment Policy in detail
By providing a wide range of insurance policies to meet different needs of the people with the most affordable premiums, the endowment policy offered by LIC is also the most purchased due to its unique features that meet the special requirements and that suit people’s individual needs.
Know More About LIC New Endowment Plan
The endowment plan offered by LIC is called the LIC New Endowment Plan. This plan further provides different varieties of endowment plans to meet customer needs and requirements. The plan also provides a loan facility to its policyholders and takes care of the liquidity needs too.
- LIC New Jeevan Anand
This plan includes both savings as well as protection of the policyholder’s family’s life. This plan offers an opportunity for the policyholder to save quite a good amount of his finances to meet the financial requirement in the future.
- LIC Jeevan Rakshak
This endowment plan offered by LIC does not provide any limit on the maximum sum assured payable. At the maturity stage of the policy, the company gives a reversionary bonus and an additional bonus which is final to the policyholder. It also provides a reduction facility on the premium paid.
- Single premium endowment plan
In this type of plan, the policyholder needs to pay the premium as a single payment. It provides no upper limit on the maximum sum assured payable. It offers a guaranteed surrender value and death benefits as well as maturity benefits.
- LIC Jeevan Lakshya
This endowment plan offered by LIC is particularly for children’s requirements. The beneficiary under this plan can only be children and they receive the total sum assured in case of an unfortunate event like the death of their parent. This plan offers financial support for the child so that they can achieve their future milestones with proper financial assistance.
- LIC Limited Premium Endowment Plan
In this plan, the company offers a minimum sum assured of Rs.3 lakhs and there is no limit on the upper side of the sum assured. There are three policy terms: they are 12 years, 16 years and 21 years.
How Does The LIC Endowment Policy Maturity Calculator Help?
An endowment policy is simply like a term plan that offers a lump sum amount of finance to the policyholder upon the maturity of the policy or will be paid as a death benefit to the beneficiary of the policy. Normally the term periods are 10 years, 15 years or 20 years. A policy maturity calculator is an online tool available to the policyholders that provide details such as premium amount. Surrender value, loan price, returns or benefits associated with the plan, and the readiness value.
Endowment plans are normally unit-linked and old-fashioned ones. The plan could be cashed very early as well as reaching the maturity age. However, it is dependent upon the insurance terms like how long the policy is running and how much was paid already. The policy maturity calculator is accessible directly to the policyholders now. The policyholders can find out how much they will get paid as death benefits and maturity benefits on the previously fixed sum assured.
LIC Endowment policy premium calculator helps the policyholder to calculate the benefits in the easiest ways. The calculator also gives the information regarding Simple Reversionary Bonus and Financial Additional Bonus. So the policy maturity calculator is not to be missed and has to be used to the maximum to clarify all your doubts linked with the plan.
All the policyholder needs to do is to enter into the official website of LIC and go to the maturity calculator for your particular endowment plan with LIC then follow these steps.
- Enter your name
- Enter your age
- Choose the tenure of your policy
- Amount of Sum Assured
- If there are accidental benefits applicable then tick the check box
- Click on the “Calculate” button.
Common FAQs
- How do I know if an endowment policy is for me?
The endowment policies are for people who have a regular income and those who may require a lump sum amount after a certain period. The category list of people can include, salaried employed, professionals such as lawyers and doctors and also small business owners. According to financial experts, endowment plans are the best for these people to meet their future long-term financial needs.
- Do I get tax-benefit in my Endowment policy?
The maturity amount received by the policyholder for their endowment policy is tax-free as per the law of Income Tax. The death benefit is also tax-free. However, the premiums paid for the endowment policies are taxable as per sections 80C and 10(10D) of the Income Tax Act.
- How does an endowment plan differ from a term insurance plan? Are they both not the same?
The term insurance plan provides death benefits to the policyholder’s family in case the policyholder dies during the tenure of the policy. They do not pay any sum or maturity benefits for the insured if he survives the policy tenure. But endowment policy pays both death benefits to the family in case of the event or maturity benefits are also paid in full to the insured himself if he survives during policy tenure along with any additional bonuses if available.