Life Insurance policy 'maturing'?
Discussion
TBH I haven't done any research on this - I was perusing PH when it popped into my head so I am starting here.-
I have heard/read in the past about life insurance policies 'maturing', an event that seems to result in some cash for the insured. Is this something that all life policies do, or just some, or just policies from the past? Why does it happen, what's it for?
I have heard/read in the past about life insurance policies 'maturing', an event that seems to result in some cash for the insured. Is this something that all life policies do, or just some, or just policies from the past? Why does it happen, what's it for?
No, not all policies have an investment element in them.
For example, term insurance will pay out if you die within an agreed period of time. If you live longer than that, then the policy simply lapses.
Others, like an Endowment policy, for example will pay out in the same way as a term insurance policy, but if you live to the end of the agreed period, then a separate investment part of the policy will pay out a sum of money.
Tim
For example, term insurance will pay out if you die within an agreed period of time. If you live longer than that, then the policy simply lapses.
Others, like an Endowment policy, for example will pay out in the same way as a term insurance policy, but if you live to the end of the agreed period, then a separate investment part of the policy will pay out a sum of money.
Tim
catman said:
No, not all policies have an investment element in them.
For example, term insurance will pay out if you die within an agreed period of time. If you live longer than that, then the policy simply lapses.
Others, like an Endowment policy, for example will pay out in the same way as a term insurance policy, but if you live to the end of the agreed period, then a separate investment part of the policy will pay out a sum of money.
Tim
Strictly speaking, a policy which pays out on survival to the end of an agreed term is a Pure endowment. An endowment assurance is a policy which pays out on survival to the end of an agreed term OR on earlier death.For example, term insurance will pay out if you die within an agreed period of time. If you live longer than that, then the policy simply lapses.
Others, like an Endowment policy, for example will pay out in the same way as a term insurance policy, but if you live to the end of the agreed period, then a separate investment part of the policy will pay out a sum of money.
Tim
Hence an endowment assurance (often just referred to as an endowment policy) is a term assurance and an endowment assurance in one policy.
Sidicks
There are mainly two types of life insurance policies. The ones that can be “cashed out” or have an investment component are whole life or permanent life insurance plans. The only way to access the accumulated cash value of a whole life insurance plan is to surrender it or borrow against it.
These policies are typically much more expensive than term life insurance, which is the simplest and cheapest form of life insurance.
An endowment policy is a life insurance contract that pays out a lump sum after a specified term or at the time of death whichever occurs earlier. It is not so much a life insurance plan, but an investment plan that provides life cover.
Denise at AccuQuote
Disclaimer: I work for AccuQuote and this is my personal opinion.
These policies are typically much more expensive than term life insurance, which is the simplest and cheapest form of life insurance.
An endowment policy is a life insurance contract that pays out a lump sum after a specified term or at the time of death whichever occurs earlier. It is not so much a life insurance plan, but an investment plan that provides life cover.
Denise at AccuQuote
Disclaimer: I work for AccuQuote and this is my personal opinion.
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