Whole Life Policy Vs Endowment Policy

Here is a reader’s query about Whole Life Policy & Endowment Policy

“I would like to know weather we should opt any riders available in insurance policy.
Pls give me your opinion about endowment policy & whole life policy.
while taking an insurance policy should we take with profit policy or without profit policy”

Well, I had forwarded this query to Mr. Sanjai Matai. Sanjay, B.E., PGDM (IIM, Calcutta), has more than 19 years of work experience in the area of Corporate Finance and Investment Advisory, with companies such as Maruti, IDBI, Ballarpur Industries, etc. Sanjay is the promoter of 'The Wealth Architects', a firm which focuses on helping individuals plan their finances in line with their needs, aspirations and risk appetite. He is also the author of the e-book 'Plan for Prosperity' and Expert Advisor to CNBC TV18's book 'Everything you wanted to know about investing'.

You Can read more articles by Sanjay Matai here.

Here is the answer of your query.

Hi,
The choice of rider will depend on one's needs. There is general purpose yes or no answer for this.
Both endowment and whole life policies are avoidable.

A better strategy would be to buy a combo of term insurance+Mutual Funds. This will not only be cheaper and better-yielding strategy, but also be more flexible and diversified.

Thanks & regards
Sanjay Matai
The Wealth Architects
We design your financial destiny
www.wealtharchitects.in

So according to Mr.Sanjay Matai, instead of going for endowment or whole life policy one should go for Term Insurance + Mutual Funds.