Temporary Endowment Insurance
A temporary endowment insurance is an insurance in which the insurance company promises to pay the face value of the policy to the beneficiary upon the death of the insured, only if the insured dies within n years of the origination date of the policy, or, if the insured is still alive after n years, to pay the face value to the insured at the end of the n-year period.
Thus a temporary endowment policy actually combines the features of an n-year term insurancy with an n-year pure endowment.
Please note that FinKit's Temporary Endowment Insurance calculation only calculates the net single premium, ignoring expenses.
Input
| • life table | |
| • current age | |
| • policy face value | |
| • nominal annual rate |
Note: FinKit assumes that the benefits are paid out at the end of the year in which the insured dies. In real life they are paid promptly upon proof of the insured's death.
Results
| • net single premium |
| • n-year term endowment factor |
Example
| • | What is the net single premium for a ten year endowment insurance policy of face value $1,000, issued to a male, now aged 65, if interest is at 4 %?
Answer: $705.91. |
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