Like all other insurance policies, endowment policy cost is not fixed. It is different for different people because it depends on numerous factors like an individual’s age, risk appetite, current income, life stage, and personal financial needs. Moreover, due to their nature, endowment policies tend to be more expensive as compared to other life insurance plans.
The premium rates are higher because endowment policies are designed to help you save while offering life insurance benefits like compensating your beneficiaries should you die before the policy term expires.
Since endowment policies are expensive, it is advisable to be well informed about the different types of endowment policies in the market, their benefits, premium rates and whether they change with time. A slight mistake during the endowment policy selection stage can cost you a lot of money in the long run.
While choosing an endowment policy from a company, examine the company’s track record in making bonus payments and settling endowment policy claims. Try translating the offered bonus payments into ROI to determine the relative value of an endowment policy before purchasing it. This helps you determine if the policy is worth its high premium charges.
Learn about Endowment Policies
Endowment policies are life insurance policies that not only cover the life of an insured person but also help them save regularly for a predefined period of 10 to 30 years so that they can get a lump sum payment upon maturity. Therefore, it can be classified as a retirement plan and a necessity for ensuring healthy financial planning.
This is done so that the lump sum payment can be used to meet huge financial needs like buying a home, paying for college education, or funding your retirement goals. The main benefits of an endowment policy include having goal based savings, protecting your loved ones financially, tax benefits, and the ability to obtain loans against the policy when faced with a financial emergency.
Here is what you should understand about endowment policies.
1. Who should consider buying an endowment policy?
Insurance experts recommend endowment policies to people who have regular sources of income and may require a lump sum amount of money after a certain duration like 10 to 30 years. Apart from offering death benefits, endowment policies help you in saving money that could come in handy when faced with a serious financial emergency.
Hence, it is ideal for people of all ages and especially young professionals who may not have mastered the art of saving. This is because its saving component can help them achieve long-term financial security. It is also ideal for people who like to be risk-averse.
2. Why should you buy an endowment policy?
Endowment insurance plans are designed to offer a disciplined way of saving money that will be used to meet future financial needs or make investments upon retirement. Moreover, they come with the added advantage of the life risk cover that helps beneficiaries if something happens to you before the policy matures.
The returns offered by endowment policies may be low but it is a risk-free cover that guarantees a lump sum payment. It also provides tax benefits.
Find Endowment Policies Online
Unlike before, people can now find adequate information online about different insurance products like the endowment policies. The information includes what the policies offer, their premium charges, terms and conditions, as well as the policy qualification criteria used by different insurance providers.
Endowment policies online are available on:
1. Insurance provider websites
The internet of things has changed how businesses operate and market their products and the insurance sector has embraced the changes. As such, most, if not all, endowment policy insurance providers will offer adequate cover information online in a bid to lure clients.
The information may include how settlements are made, policy duration, policy cost based on different factors like life stage, and the benefits of taking out an endowment cover. Additionally, insurance providers allow clients to purchase endowment policies online with assistance from their representatives via live chat who are resourceful and always ready to address client concerns.
2. Insurance comparison websites
Established insurance comparison websites like Coverfox.com offer information about endowment insurance plans offered by different insurance companies. Hence, they are ideal research points if you are not sure about the right insurance provider to work with.
This is because they not only offer endowment policy information but also compare what different insurance providers offer, their premium rates, bonus payments, claim settlement and customer relations. Additionally, they offer genuine reviews written by previous endowment policyholders or their beneficiaries.