What happens when an endowment policy matures?
James Williams
Updated on February 24, 2026
When the plan reaches the end of the policy term, no matter how many years, the endowment plan is said to mature. If the policyholder survives till the end of the policy term, a maturity benefit is paid out to them. If they die before the maturity of the plan, a death benefit is paid out at the time of death.
What is the maturity benefit in endowment plan?
Maturity Benefit: This is the substantial amount you receive at the end of the term, when your endowment policy matures. Death Benefit: This is the money your loved ones receive once they claim for it in case of your untimely death. This is equivalent to the life insurance policy cover.
What are matured endowments?
In insurance, a type of life insurance that is payable if the insured is still alive on the date the policy has matured.
Are endowment policies taxable on maturity?
Personal Tax Benefits: Tax free pay out on maturity or death (provided complies with normal qualfying rules) Investment fund pays taxes before you receive returns.
How is an endowment paid out?
An endowment policy is a type of investment that you take out with a life insurance company. You pay in money each month for a set period of time, and this money is invested. The policy will then pay you a lump sum at the end of the term – usually after ten to 25 years.
What is the surrender value of an endowment policy?
When you stop making payments towards the premiums before the policy ends, you will receive a surrender value. The amount you receive upon surrender depends on the number of years of the policy along with the premium and bonus meted out.
How is endowment policy maturity amount calculated?
Details of your Plan:
- Sum Assured (A): = Rs. 5,00,000.
- Total Bonus Amount on Maturity (B): * = Rs. 1000.
- Maturity Amount (A+B): = Rs. 35,000.
- Period of Maturity = Dec, 2021.
What is the difference between whole life and endowment?
The difference is that endowments have a shorter coverage period and mature sooner, usually in 10 to 20 years. Whole life policies are designed to last for the insured’s whole life, so they mature when the insured policyholder reaches the age of 95 or 100. It is less likely for whole life policies to mature.
Can I cash in my endowment policy early?
You can cash in your policies whenever you want to. However, if you cash them in early, you may lose out on any final bonus or mortgage endowment promise that may be added. Also, there may be charges for cashing in your policies early.
