An endowment plan or an endowment policy is a life insurance policy that offers you a combined savings plan as well as an insurance cover. It does not only aid you in regular saving for a certain tenure but also ensures that you obtain a lump sum amount based on the maturing of the policy even when you survive the term of the policy.
Further, the best endowment plan allows the policyholder to obtain the sum based on a fixed date according to the terms and conditions of the policy. Nonetheless, in the situation of immediate death of the policyholder, the company of insurance pays this amount along with a bonus to the person nominated in the policy. Further, it is beneficial for the security of the family as well as self even after being retired in order to meet certain needs of finance like funding the education of children or their marriage and even buying a new house.
Benefits of Best Endowment Plan
Similar to other policies, the best endowment plan would bring you a number of advantages, which are as follows.
- Benefits of Maturity: This refers to the significant amount that the policyholder receives when the term of the policy ends. This means the maturing of the best endowment plan that you opt for. After surviving the entire period of the policy, the maturity of the policy would mean that the policyholder obtains a sum that is initially assured along with the bonus, if applicable, for the policy’s period. In fact, this amount can be received without availing of any taxes.
- Benefits of Tax: The best endowment plan provides benefits associated with taxes as well. The premiums that you tend to pay during the policy also tend to decrease the income that is taxable based on the Income Tax laws of the nation.
- Benefits of Death: In case of your unfortunate demise during the policy period, the people that are dependent on you for finances, that is, the nominees of the policy, will be able to obtain the money in case they claim your/ policyholder’s untimely demise. The best endowment policy is the same as a life insurance policy cover.
The best endowment plans are the ones that have a period of maturity ranging between 15 and 20 years since they are more profitable because one can manage to gather more amount of funds over a longer duration. Also, the maturity amount can also be utilised for funding huge expenditure in the subsequent years, including buying a house, moving to another state, and even funding the education of the children.
The Bottom Line
The best endowment plan is the one that offers you a low-risk plan with multiple benefits of investment as well as insurance. Further, it also provides the lump sum amount eventually at the end of the maturity of the policy. Always keep in mind your loved ones who are financially dependent on you, even if you do not wish to consider any investments.