When I started my career three years ago, I landed up taking an endowment policy, which I now realise was a waste. I am told that I should wait for two more years before I can surrender this policy and get some money in return. What should I do?
Tasleem Haider, Jammu
Check with your insurer what your current surrender value on the policy would be. If the gap between the premiums you have paid so far and the surrender value is marginal, cut your losses and just close the policy. However, if the gap is wider, which is likely to be the case – get a sense on how much it would be two year hence and then based on your total premium outgoes, decide if you wish to continue with the policy or close it. Endowment plans are a mix of savings and insurance and they are best avoidable as you do not get high value insurance for the premiums you pay and if you opt for a high value cover, the premiums may be too high to afford. It is best to keep life protection and savings separate when taking a life insurance policy.
