What Are Traded Endowments For Low Cost Life Insurance?

By Patrick Cooper Posted in Life Insurance News

An endowment policy is a life insurance policy that is basically designed to pay a certain amount of money when someone who holds the policy dies. There are different types of endowment policies, such as the traditional endowment, the unit linked endowment, full endowments, low cost endowments, modified endowments, and traded endowments. Traded endowment policies are also known as second hand endowment policies. There is nothing especially complex about them, and they are what their name says they are. They are simply regular endowments that have switched users, or essentially sold to someone else halfway through its term.

Who Buys Traded Endowments?

Traded endowment policies are usually bought by investors, but they can be bought by essentially anyone who wants to buy it. Usually, buyers will buy the policy for more than the original surrender value. Most insurance policies will not offer a great deal of money for the policy to be terminated, and thus, there are investors who buy the traded endowment policies. Investors buy these policies for more than the surrender value because essentially, the policy is worth more if it is still activated than it is if it is terminated by the insurance company. Although some people find their policies unwanted, others are more than willing to buy the policy to take advantage of any other advantages that come with endowment policy. In some cases, selling it to other investors is a fairly simple process, and can be better than simply surrendering the policy to the insurance company. For this reason, there is a specific market dedicated to the buying and selling of endowment policies. When the policy is sold, all of the benefits are given to the new owner of the policy. When the previous owner dies, the person who bought the policy will collect the payment. Although this is a good system, the market is only open to traditional policies with profits.

Related posts:

  1. What Is Endowment Life Insurance?
  2. What Are Modified Endowments for Low Cost Life Insurance?
  3. What Are Full Endowments For Low Cost Life Insurance?
  4. What Are Traditional Endowments For Low Cost Life Insurance?
  5. What Are Low Cost Endowments For Cheap Life Insurance?

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