Best Endowment Plans in India 2021

Published On Mar 11, 2021 12:00 AM By InsuranceDekho

Endowment policies are a type of life insurance plan which offers you the benefits of both a life cover and investment corpus. They provide 3 kinds of benefits - death benefit, maturity benefit and appreciation of wealth via guaranteed additions. So, if you are looking for a policy which offers wealth appreciation, life cover as well as a tax benefit, then you can certainly go for an endowment plan.

Why You Should Buy an Endowment Policy?

Endowment plans are an excellent investment option that helps you save a modest sum for your financial needs by proving you guaranteed additions at regular intervals during the policy term. 
This helps you accumulate an investment corpus with minimal efforts from your end.

Also, these guaranteed returns are risk-free as no market-linked instrument is involved in these plans unlike ULIPs. Another advantage of endowment plans is their tax benefits. Investment in an endowment plan is eligible for a tax deduction of up to Rs. 1.5 Lakh under Section 80C of the Income Tax Act. In addition, the insurance proceeds received as death benefit or maturity benefit qualify for a tax exemption under Section 10(10D) of the IT Act.

One of the unique benefits of an endowment plan is that it remains valid till the date of plan maturity even after the payment of the death benefit to the nominee in case of an unfortunate demise of the life assured during the policy term. Thus, an endowment plan ensures guaranteed returns to your family in your absence.

Also Read:- How Does An Endowment Plan Work?

Best Endowment Plans in India 2021

Following is the list of the best endowment plans available in India in 2021:

Plan Name

Insurance Provider

Claim Settlement Ratio

Super Endowment Plan

Reliance Nippon Life Insurance

98.14%

Premier Endowment Plan

Kotak Life Insurance 

96.38%

Life Gain Premier

Max Life Insurance

99.22%

Guaranteed Returns Insurance Plan

Tata AIA Life Insurance

99.06%

Life Endowment Assurance Plan

HDFC Life Insurance

99.07%

LIC’s New Jeevan Anand Policy

Life Insurance Corporation of India

96.69%

Insurance Vision Endowment Plan

Aditya Birla Sun Life Insurance 

97.54%

Shubh Nivesh Plan  

SBI Life Insurance 

94.52%

Elite Advantage Plan

Bharti AXA Life Insurance

97.35%

Dhan Nirman Endowment Plan

Aviva India LIfe Insurance 

97.53%

(Source: IRDAI Annual Report - Claim Settlement Ratio for the year 2019-20)

Things To Consider Before Buying an Endowment Plan

It is important to know the factors which you should consider while buying an endowment plan in addition to the premium of the plan. Assessment of such factors help you analyse if the plan is worth the premium or not. Here’s your list of the key factors which you should keep in mind while choosing an endowment plan. 

1. Sum Assured

One of the major factors that contributes in selecting the right endowment plans is the amount of sum assured offered by the plan. So do check the amount offered by various policies before opting out for one. Select the policy that gives you the maximum benefit.

2. Features

Another factor is that of the features of the policy that might include the policy term, eligibility criteria, premium payment term, maturity term etc. all these factors are essential in deciding the right endowment policy.

3. Frequency of Premium Payment

This involves the How would you like to pay your premium? Various Plans give different types of options ranging from monthly, quarterly or annually. According to your convenience you can select the mode of payment of premiums.

4. Policy Loan Availability

Endowment policies also might give you the option of purchasing a loan against your policy. This could be a beneficial factor considering any sudden financial requirement. The loans against the policy are generally issued against your surrender value of the policy.

5. Paid-up Policy Benefit

You may also go for a paid-up policy, where you actually stop paying the premiums and get a paid-up benefit at maturity.

6. Availability of Riders

A lot of the endowment policies offer life insurance riders which enhance your basic standard plan and provide you with extra coverage.

7. Guaranteed addition/bonus

Some plans on endowment offer guaranteed additions (GAs). Guaranteed Additions (GAs) are applied to the scheme at the end of each policy year if all due premiums have been charged.This addition shall be charged as a rate on all the premiums paid so far. This ensures that you will earn ongoing incentives for following a strategy.

You May Also Like to Read:-Reasons To Purchase An Endowment Plan

All You Need To Know About An Endowment Policy

8. Claim settlement Ratio and Process

You would pick an endowment scheme from an insurer that has a high and reliable claims settlement ratio. In addition, an easy and fast claims process should be preferred.

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.