Life · Chapter 4 · Special Products
Endowment Contract
Definition
Pays the face amount at a fixed earlier date (e.g., 20 years or age 65) OR at death if sooner. Rapid cash value, higher premium.
Exam tip
Since the 1984 Tax Reform Act, a policy endowing before age 95 is not life insurance for tax purposes.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms