Life Insurance | Benefits of Endowment Plans - Greyfont


Life insurance is of many types. Endowment plans being one of the most popular forms, have more than one benefits. Their features help many people to achieve their insurance goals. If you too plan of buying an endowment plan but do not know about its usability, have a look at the factors mentioned below.


This article lists out the key advantages that an endowment plan offers.


Benefits of Endowment life insurance

Mentioned below are the top benefits of buying an endowment plan:

  • Investment with insurance: Endowment plan is a mixture of both insurance and investment. One part goes safely gets locked in a death fund and in case you die, your family will receive the sum assured. Whereas, the balance part is invested in the financial market that helps you get bonuses which in turn aids in growth of your funds. On maturity of an endowment plan, you will receive the maturity benefit along with the accumulated dividends.
  • Risk free, guaranteed returns: Being a risk free investment, endowment plans offer you fixed returns. Besides, there are fewer to nil chances of losing your hard earned money. Your corpus grows because of the dividends you earn get added to your funds. You also have an option of withdrawing the dividend from time to time as well. This is how cash value of the endowment plan becomes flexible and it therefore works in your favour. You get double advantage of financially securing your beloved family in case of your untimely death as well as a peace of mind since your investment would be risk-free.
  • Inculcates a habit of saving: Endowment plans are definitely your best buy in case you are a spend-thrift. You get dual benefits of getting a life cover as well as this inculcates a habit of saving. You can save regularly for a considerate time frame, in order to get eligible for a lump sum amount on maturity if you outlive the policy period. These funds can be used for your child’s education or marriage, or if you wish to purchase a house, or any other purpose, etc.
  • Tax benefits: You get exciting tax benefits if you opt for an endowment plan. Section 80C of the Indian Income Tax Act, 1961 offers you tax exemption on the premiums that you pay towards the endowment plan. The dividends that you earn would also be tax free as well as the death benefit that your family gets from the life insurer after your demise.
  • Loan option: You can avail loan facilities against your endowment life insurance plan by pledging the same as collateral. Being easy to procure, you also get a lower rate of interest. This is one of the main advantages of buying an endowment plan. In case of a financial emergency, you can easily access these funds. You can avail a loan that is equal to the sum assured of the plan.


Thus, an endowment plan has more than one benefit in its platter. Needless to say, BUY ONE TODAY!


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