What is an Endowment Plan?

Buy a Life Insurance Plan in a few clicks


Now you can buy life insurance plan online.

Kotak e-Term Plan

Kotak e-Term Plan provides a high level of protection to your loved ones in your absence. Know more

Kotak Guaranteed Savings Plan

Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality. Know more

Kotak E-Invest

Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs. Know more

Kotak Health Shield

Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability. Know more

Kotak Lifetime Income Plan

Kotak Lifetime Income Plan gives you the security of your income continuing throughout your life and in your absence throughout your spouse's lifetime! Know more

What is an Endowment Plan?

What is an Endowment Plan?
  • 11th Jul 2022 |
  • 2,620

There is no denying that everyone wants a long and happy life for themselves and their loved ones. This is where life insurance has gained immense popularity. It not only protects your loved ones after your untimely death or disablement but also offers a secure, happy, and fulfilling post-retirement life that you can enjoy with your whole family.

But, do you wonder what is an endowment plan or why it has gained immense popularity? Worry not! This article contains the guide for an endowment plan. Let’s dive deeper to know the details.

What is Endowment Insurance Plan?

Endowment plans refer to the life insurance policies that offer risk cover to the policyholder under the unfortunate event and a maturity benefit at the end of the policy term. The policyholders are paid a lump sum after a specific period called the maturity period. The insurance company will pay the assured amount to the policyholder’s nominees in case of the holder’s death or the holder themselves on a fixed date.

Why Must You Apply for an Endowment Plan?

Now that you know what is endowment plan in insurance is, let’s get into the details regarding why you must apply. An endowment plan offers apparent benefits to the policyholders. When the endowment insurance policy matures, the policyholder has a pool of savings. They can either reinvest the amount, use it for their personal needs or enjoy life post-retirement. Therefore, an endowment policy is almost risk-free and offers a steady amount on a fixed date as long as the premium is paid.

Benefits of an Endowment Plan

Below mentioned are some of the benefits of an endowment plan:

1. Maturity Benefit

Under the endowment life insurance plan, the policyholder gets a substantial amount at the end of the term when their policy matures.

2. Death Benefit

This is the money that your loved ones/ nominee receive once they claim for it in case of your untimely death. It is just like a life insurance policy cover.

3. Tax Benefits

Endowment insurance plans also offer tax benefits to the policyholder. The premiums paid for the policy can help you reduce your taxable income per India’s Income Tax laws.

Endowment plans with a maturity period of 15 to 20 years are more profitable since you can quickly accumulate more money over a more extended period. In addition, the amount paid on the maturity can then be used to fund significant expenses in the future.

Some plans even offer guaranteed returns and bonuses to the policyholder in addition to the sum assured, which is added to the policy holder’s account every year. These benefits and the tax savings make the life insurance endowment policy an extremely appealing investment instrument.

If you are looking for a low-risk plan with the dual benefit of insurance and investment or for a plan with a long-term investment perspective that gives you a lump sum amount in the end, then a savings endowment plan is suitable.

Some Points to Remember

Now since you know what is whole life endowment plan, here are some points you must remember before buying this plan.

Endowment plans come with a surrender value, i.e., the amount the policyholder receives in case they want to discontinue the plan. However, you as a policyholder are eligible to receive this amount only after paying the premium for at least two years. In case of a financial emergency, this surrender money can come handy. However, it would be best if you keep in mind that the surrender value is usually lower than the total premium paid in the initial policy years, which means that it isn’t a benefit as much as partial compensation. Therefore, investing for a more extended period in endowment policy is advisable.

Kotak e-Term Plan


  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492


Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Can You Transfer Life Insurance Policies to Another Company in India?

How To Use Different Types Of Life Insurance For Retirement Planning?

Types of Life Insurance policies in India

Benefits of Term Insurance with Critical Illness Rider

What are robo-advisors in insurance?

When are Millennials required to take out a life insurance policy?

Why do I Need Life Insurance?

Why One Must Buy Term Insurance before 25 Years

How Many Insurances Should I Have?

5 Smart Steps to keep in mind while buying term policies

How Much Life Insurance Costs and How Much Insurance Cover You Need?

Life Insurance Plans for Women

What Is Investment Insurance?

Compare Different Life Insurance Products Offered By Kotak Life

What is a Single Premium Term Plan and its Tax Benefit?

Adding A Child to Your Life Insurance Policy?

Life Insurance and Millennials

Is it Possible to Make Changes in a Term Plan’s Specification Post Purchase?

Customer Awareness on Information Security

Best Insurance Plans in India

Why You Should Never Cancel Life Insurance Policy

Term Insurance Tips for NRIs in India

Is Return-of-Premium (ROP) in Life Insurance Worth It?

Process of Filing A Claim For Life Insurance

Insurance Changes You Need to Make Post Marriage

How Much Life Insurance Cover Do I Need?

Life Insurance vs Mutual Funds

Always keep your Nominee informed

Benefits of Buying Term Insurance Plan for Senior Citizens in India

First Job? Here’s Some Tips on How to Manage Finances

Does Family History Affects your Term Life Insurance Rates?

Does Life Insurance Policy Cover Covid Death?

Does Life Insurance Cover Terminal Illness?

Think About Life Insurance Sooner than Later

Top 5 Common Life Insurance Myths and Facts

What is Human Life value and a Human Life Value Calculator?

Guide for Buying Online Term Insurance Plans for Senior Citizens

Health Insurance VS Life Insurance

All about Life Insurance Calculators

6 Things You May Not Know about Life Insurance

Staying Insured While Investing

How to Choose Life Insurance for All Ages?

What is Sum Assured in Endowment Policy?

What is Minimum Life Insurance Policy?

Do Life Insurance Premiums Increase Every Year?

5 Reasons Why a Women Should Buy a Life Insurance

Life Insurance with Money Back vs Without Money Back

Take 100% Responsibility of Your Family with Term Life Insurance

Is Life Insurance For Millennials Really Needed?

What is the Difference Between Insurance and Assurance?

Life Insurance Policy Closure

Can You Apply For A Life Insurance After Getting Heart Attack? Here is Everything You Need To Know

Why Online Term Insurance Plans Cheap?

When Should You Review Term Life Insurance of Yours?

5 Common Life Insurance FAQs and Answers

Can An Individual Buy Multiple Term Insurance Plans?

Why Life Insurance Is Always a Smart Decision

Most Common Life Insurance Riders to Enhance Your Existing Policy

Term Life Insurance Vs Money back Life Insurance

A Term Insurance Guide for Disabled People

Why You Should Buy Term Insurance under the MWP Act (Married Women’s Property Act)?

What Should One Expect During the Medical Evaluation for Life Insurance?

Term Insurance Claim Process

Key Things to Review in Your Life Insurance Policy Document

Unit-Linked Life Insurance (ULIPs) vs. Term Insurance

Choosing a Life Insurance Beneficiary

How to Revive the Lapsed Life Insurance Policy?

Can NRI Buy Term Insurance in India?

What Is Insurance Rider and It’s Benefits?

Importance of Checking Claim Settlement Ratio before Buying Life Insurance

Life Insurance for Overweight Applicants

Is It Time to Review Life Insurance Policy of Yours?

“Life” Insurance or “Death” Insurance?

How to Buy a Life Insurance Plan?

All About Life Insurance and How It Works?

Do Your Financial Planning with Life Insurance!

What Is Social Impact Investing and How Does It Benefit Society?

How Much Life Insurance Do You Need?

Sabse Pehle Life Insurance

Term Life Insurance for Home Loans: The Maximum Security

FAQs on Life Insurance

Different Types of Insurance Policies in India

What Should One Consider Buying: Term Insurance or Traditional Life Insurance

All about IRDAI

What is the Current Trend in Term Insurance?

5 Easy Steps to Buying A Policy

What are the Benefits of Endowment Policy?

5 Ways to ensure faster settlement of claims

What is Underinsurance & The Dangers of Being Underinsured

Difference Between Term Insurance and Endowment Plan

Savings cum Protection Plans Secures Your Family from Unforeseen Events

Choosing the Right Life Insurance

All You Need to Know About Life Insurance - Its Benefits, Features, and Types of Life Insurance

How to Make Death Claims on Life Insurance?

Can a Term Plan be the Substitute for a Retirement Plan?

Different Types Of Life Insurance In India

NRI Premium Payment Options

What is the Difference Between Limited and Regular Pay Insurance Plan?

Life Insurance Vs. Mutual Funds Investment

Why do most Indians choose the wrong way to buy life insurance?

How to Find the Best Term Insurance Plan in Seven Steps

Important Life Insurance Terms You Must Know

Should you buy a Renewable Term Life Policy?

Important Features of a Term Insurance Plan

Digital Life Certificate for Pensioners Seeking Pension

How Do Term Insurance Plans Differ for Smokers?

Types of Life Insurance Or One Investment, Many Options

Voluntary Life Insurance Policy Vs Group Life Insurance

Comparing low premium term insurance Is Not the Only Factor While Buying Life Insurance

Difference Between ULIP and Endowment Plan?

How Does Life Insurance Work?

5 Things to Consider Before You Buy Life Insurance

Why Your Family Should Know About Your Life Insurance Policy?

What Is Financial Planning?

Why Do Life Insurance Agents Avoid Selling Term Plans?

A Step-by-Step Guide: How To Make An Investment Plan?

Loan Against Life Insurance Policy

5 Things to Keep in Mind While Buying Life Insurance Policy

5 Advantages of Life Insurance Going Digital

Guidelines for Linking Aadhar and PAN to Insurance Policies

Different Kind of Deaths that are Not Covered in a Term Insurance Plan

Various Term Insurance Premium Payment Options Available in India

How to Buy a Term Life Insurance Online

Biggest Life Insurance Myths

How to Choose the Right Life Insurance Policy for Your Age?

Term Life Insurance vs. Accidental Death Insurance

What is Life Insurance?

Why Buying a Term Insurance is Important for all Parents

7 Superficial Reasons People Avoid Buying Insurance Online

Is Life Insurance an Investment?

What Happens If I Stop Paying My Life Insurance Premium?

How to Customize Your Life Insurance Policy with Riders

Life Insurance for Overweight Applicants

What is Group Insurance?

Does Life Insurance Pay for Suicidal Death?

Kotak Life Claim Settlement Ratio

All About Backdating in Life Insurance

Who Is A Nominee In A Life Insurance Plan?

In India, should NRIs purchase life insurance?

How Often You Must Review Your Life Insurance Policy?

Choose the Nominee of a Term Life Insurance Plan Wisely

Term Insurance Vs Car Insurance: A Budgetary Choice You'll Regret

Choosing Between Short-Term & Long-Term Insurance Plans

Important Factors to Consider While Choosing the Right Term Period for Your Term Insurance Plan

Why is Medical Test Important While Buying a Term Insurance?

Life Insurance Beneficiary

Nominee in insurance - A Complete Guide on nomination in insurance

Life Insurance vs Health Insurance

All about Your Rights and Duties While Buying Life Insurance Policy

9 Most Important Things You Must Learn About Paying Life Insurance Premium

4 Benefits of Gifting Life Insurance Cover to Your Spouse

Details Required To Be Filled In A Life Insurance Form

Are Deaths Due To Coronavirus Covered by Kotak E-Term Plan?

How to Select a Perfect Life Insurance Policy in India to Protect Your Future?

Reasons Why Term Insurance Claims Get Rejected

Is it Worth Buying Disability Rider on Term Insurance?

What Is Surrender Value (Cash Surrender Value) in Insurance and how is it calculated?

Terms and Conditions of Term Insurance Plans

Why Term Insurance for Women is Important?

Why Renewal of Term Insurance Plan is Important

What Is The Life Insurance Penetration In India And How Does It Compare Globally?

Life Insurance and Retirement Planning

Everything You Must Know About ULIP Riders

Role of IRDAI in the Insurance Sector

What is a savings plan?

What Is a Whole Life Insurance Plan?

What Is Insurance Coverage?

Difference Between Money Back and Endowment Policy

Important Terminologies of Life Insurance

How to Choose a Life Insurance Policy

Insurance Vs Investment - A Guide to Your Financial Goals

6 Different Types of Insurance Policies

Is Voluntary Life Insurance the Same as Basic Life Insurance?

Is it Possible to Reduce Life Insurance Premium without Affecting Sum Assured?

Life Insurance for Millennials

Beware of Phishing & Fraud Insurance Calls

Term Insurance Vs Life insurance: Small Details, Big Differences

How to Calculate Human Life Value(HLV)?

What Is Staggered Payment Option Under Term Insurance Policy?

Types of Insurance You Must Invest in for Secure Future

What Is the Procedure to choose a nomination in life insurance policy?

ULIPs: Suitable for all

Is It Advisable To Have Multiple Life Insurance Policies?

5 Reasons Why You Need Life Insurance in College

10 Most Frequently Asked Questions - FAQs on Term Insurance

1 CR Term Insurance Plan: How to Pick the Best 1 CR Term Plan