Ask Mint | Endowment plans offer safety, security with adequate returns

Ask Mint | Endowment plans offer safety, security with adequate returns

The insurance business in India isn’t just growing, but also becoming more sophisticated in terms of product offerings. To help readers keep ahead of developments in this business, Mint features a Q&A on insurance every Monday.

I am a 26-year-old man. If I have group life insurance through my job, do I still need an individual life insurance policy?

Group life insurance is a benefit that some people receive through their employers. As you are at a young age, you might opt for other career opportunities. The insurance your current employer offers may cease the moment you leave that job. So, it is advisable that your own personal policies be the mainstay of your coverage, with the firm’s offerings serving as an incremental source of protection.

I am 25 years old, and single. I have been advised to buy an endowment policy. What are its advantages?

Endowment policies are essentially accumulation plans that may or may not guarantee a certain amount of cash at the end of a specified period, or when the eventuality happens; whichever is earlier. The advantage of the plan is that the emphasis is on safety and security with adequate returns. The protection element offered under endowment plans is valid till the end of term. The plan can be used by you to save for specific purposes such as planning your wedding, buying a house, taking a vacation etcetera, with added benefit of protection.

I am 28 years old, and planning to buy a life insurance policy—how can I add to my insurance against an accident or a similar mishap?

Most companies offer riders on the base policy to offer benefits in case of disability arising from accident related mishaps. You can opt for a personal accident benefit rider that is a low-cost additional benefit, and is paid to the nominee in case the insured’s death?is?caused by an accident.

Readers are welcome to write in with their queries to The questions will be answered by senior executives from leading insurance firms.

This week’s expert is Rajesh Relan, managing director, MetLife.