Question

What is a major benefit of an endowment policy over a whole life policy?

a.

Endowment policies have lower premiums.

b.

Endowment policies cover the risk for a shorter period.

c.

Endowment policies pay the sum assured back to the policyholder.

d.

Endowment policies do not accumulate bonuses or dividends.

Posted under IC 89 Management Accounting

Answer: (c).Endowment policies pay the sum assured back to the policyholder. Explanation:A major benefit of an endowment policy over a whole life one is that at the end of the specified term, the sum assured is paid back to the policyholder along with all bonuses/dividends accumulated during the term of the policy.

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Q. What is a major benefit of an endowment policy over a whole life policy?
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