The majority (39%) of respondents believe that they save their capital from devaluation and increase it through a high annual interest rate in US dollars or in euros this way. 24% of those surveyed consider endowment as a good alternative to a bank foreign currency deposit with an interest rate of no more than 1%.
16% of respondents believe that endowment is ideal for saving for their children's higher education. For example, in 2023 the State Educational Savings System (SESS) will operate, to which it is planned to involve LICs.
11% of surveyed invest in order to provide a secure future for their family. Thus, in case of insurance event, there will be a financial cushion. 7% of respondents are going to or are already using endowment in order to save up for large purchases. 3% are legal entities, and enter into an agreement with LIC on corporate endowment life insurance in order to motivate employees. 57% of them, are women, whose average age is 32-46 years and 43% are men aged 37-50.
The monthly salary of respondents varies from 250,000 to 1,500,000 tenge.
Trustworthiness of endowment
Those who have chosen the endowment program for investing or saving is already familiar with the advantages of this financial instrument. In general, endowment life insurance programs are products that combine the functions of insurance and investment. It is possible to simultaneously insure health and life from unforeseen situations, and save up money. This is the main difference from risky insurance products, such as medical or travel insurance, or from bank deposits.
The main factors characterizing the reliability and benefits of endowment life insurance programs are the following:
First of all, there are tax benefits under the endowment programs. The policyholder usually pays 10% PIT when they receive any income or wages. With an agreement on endowment life insurance program, they may partially pay taxes and receive the “saved” amount along with income or salary. The insured with endowment contract may also not pay tax on insurance payments and redemption amounts upon termination of the contract with the insurance company.
The investment deposit is inviolable under an endowment agreement. The insurance premiums of the company's clients are 100% protected from confiscation and seizure and are not subject to division in property disputes.
“When concluding endowment agreement with a life insurance company, a client needs to check if the company has a license from the authorized body to carry out insurance activities, if the organization has a major participant (shareholder) capable of supporting the company in case of financial difficulties, and a large reinsurance company and the Insurance Payments Guarantee Fund,” they noted on LIC Freedom Life.
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