Endowment Life Insurance

Endowment Life Insurance

A term life insurance policy whereby the insurance company agrees to pay the death benefit when the policyholder reaches a certain age. For example, rather than waiting for death to actually occur, the company may pay the death benefit when the policyholder turns 100 years old. Because the insurance company will pay the death benefit whether or not the policyholder dies in the designated period of time, premiums on endowment life insurance are high.

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endowment life insurance

A life insurance policy that provides benefits for a specified period (for example, 20 years or until age 65) and that may be redeemed at face value if the insured is alive at the end of the specified period. Thus, payment is made regardless of whether the insured lives or dies, although the cost of the policy is quite high compared with other types of life insurance.