Life Insurance Q&A, Endowment Plans Basics, November 8, 2017
Date: 09-11-2017 Views: 937
In this video, we explain some more of the basics of endowment plans offered by life insurance companies and answer viewer queries on them.
Edited Highlights
0:48 In this video, we are taking up queries by two of our viewers on life insurance endowment plans
1:33 To understand life insurance endowment plans, we need to provide a brief primer on life insurance
1:41 Life insurance covers your family in the event of an untimely demise
1:53 When death occurs before the end of work life, the family loses out on the regular income and savings
2:09 While income takes care of regular expenses, savings when invested, grows over time to address needs like children's higher education
2:27 Term plan provides pure form of life insurance that covers the gap in financial resources in the case of an untimely demise
2:38 Term plan provides protection during the term or period of coverage of the life insurance plan
3:07 Numerous life insurance plans combine protection with life insurance
3:20 One category of protection cum investment plans is where the life insurance company is taking the investment decisions
4:00 This is what roughly an endowment plan is about
4:07 These are lower risk, lower return plans
4:10 The company can announce a bonus annually, during the course of the policy term and the end of term, and at other times
4:44 There is also another variant where apart from the protection, you take the investment decision for your premiums
5:08 This is for buying units of a fund. These plans are called unit linked insurance plans or ULIPs
5:15 There, you are choosing which fund's units you want
5:27 The investment risk is taken upon by you
5:49 Once you have figured this major difference out, the rest is easy to figure out
6:38 Joint life endowment involves a married couple buying a joint life insurance endowment plan covering each other's lives
7:07 In double endowment plan, you get double the life insurance coverage for accidental death by paying marginally higher premium
