Do you often buy things, even expensive things, to buy something? Even if you don’t need them? Spender and endowment insurance are only for people like you. Features of Endowment Policy An endowment policy is essentially a life insurance policy that, apart from the life cover of the insured, helps the policyholder to save regularly for a certain period so that he receives a lump sum. He survives the policy term on the expiry of the policy term. To meet various financial needs such as funding retirement, children’s education, marriage, or buying a house. An endowment life insurance policy pays the entire sum assured to the beneficiaries if the insured dies during the policy term or to the policy owner during the policy term if he survives the term. So, any life insurance plan with a savings component and a lump sum maturity benefit can be called an endowment plan. It can be Unit Linked Insurance Plan (ULIP) or Non-ULIP. However, in common parlance, only a non-ULIP savings-linked life insurance plan is called an endowment plan, says Dr. P Nandagopal, founder and chief advisor at financial services start-up OpenWorld Money. Endowment plans, thus, cater to the dual needs of life cover and savings under one plan. This is one of the most traditional forms of life insurance plans available in the Indian market. There are two types of endowment policies – with profit and without profit. Within these two categories are various forms of endowment schemes designed to meet the needs of children’s education, lifetime security, and pension. The main benefits of any endowment plan include the financial security of loved ones, goal-based savings, tax benefits under Sections 80C and 10(10D) of the Income Tax Act, and, in the case of a financial one, the option to avail of a loan against the policy. Emergency, said Rushabh Gandhi, Director – Sales & Marketing, India First Life Insurance. Who should consider buying endowment policies? According to experts, people with a regular income stream and those who need a lump sum after some time can consider buying an endowment plan. Endowment plans provide a disciplined path to savings, which can be helpful in a financial emergency. Salaried people, small business owners, and professionals like doctors and lawyers should look into this plan to meet their long-term financial security needs. Also, people who are risk averse and don’t mind settling for lower returns rather than taking additional risks should go for endowment plans. Said Dr. Nandagopal already. In this sense, endowment schemes are generally for the commoner rather than the rich. However, those who are only interested in the life cover and not the savings component should go for a term plan. This is because term plans are cheaper – providing more coverage for lower premiums – than endowment plans and are easier to understand. In what situations should endowment plans be purchased? Everyone needs some risk-free fixed investments as part of their portfolio. Endowment plans, therefore, should be purchased by individuals, one, to protect and secure their loved ones; two, for goal-based savings; And three, to build a corpus to meet long-term investment goals, Gandhi said. So, people with irregular income can Ku