 Sam
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 Posted: Fri Jun 11, 2004 4:47 am Post subject: What is With-Profit Endowment Policy? |
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With-Profit Endowment policy is a type of endowment given by life assurance companies. It guarantees fixed sum plus profits that are gained through the company's investments, to a policy holder after a fixed period of time.
There are two types of with-profit endowment policies:
- Full with-profit endowment policy.
- Low cost with-profit endowment policy.
Features of with-profit endowment policy are as following:
- It is a 'written contract' and a 'long term investment product'.
- It gives reversionary bonus to the borrower when the policy matures.
- There is a payment of surrender value to the policy holder in case of policy surrender.
- It guarantees a certain minimum amount when the endowment policy matures.
- It requires monthly payments and here the bonuses are declared annually.
- This type of endowment is very expensive, now it is rarely used.
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