LIFE INSURANCE

Q1 – What is Endowment Plan ? 

Endowment Plan is Saving cum Life Insurance Plan. The Plan provides a lumpsum payment of Sum Insured once the policy holder dies or when the policy matures on completion of term selected alongwith the accrued bonuses.

Q2 – What is main benefit ?

Besides safety and security, policy maturity term can be selected as per individual needs like marriage of daughter or education of children.  This gives great mental relief.

Q3 – What other benefits are there ?

• Generates financial resources by regularly collecting premiums and the funds so collected are gainfully employed in industrial development of the country.
• Promotes economic growth by mobilizing domestic savings.
• Provides Tax-Saving vide Section 80 (C ) of Income Tax Act, 1961 to individuals & HUF.
• This is an easy way to make old age provision or housing provision at later age.

Q4 – What are the disadvantages ?

• Being long term – regular savings are somewhat difficult.
• Return is low to the tune of 5-6% Only.
• If one breaks the payment in between the term, the money deposited is blocked upto the end of the policy term.
• There is up and down in man’s Life and as such there are chances of policy lapsation being a long term regular saving plan.