Reply To: Interview Preparation
sushantgupta
Highest to Lowest;
Endowment-whole-pure-term
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True, I would like to add on the reason behind this, the reason is Present Value
In Endowment, the payment is sure and made within n or at n years making it highest Pv.
In whole, the payment is also sure, but the time is not, so PV is less than endowment . So making it less chapter than endowment but costlier than pure or term since payment is sure.
In pure, the payment is made on survival after n years and people generally survive after n years making it expensive than term but because some people die, so 100% payment is not made. Thus making it cheaper than endowment or whole.
In term, this is the cheapest of all and thus have most sales. Only some people die in a span of n years, making the PV less than anyone else.
P. S- One of my teacher told me that this question is often asked in interview
But tell me 1 thing guys…as u all are saying premium for pure endowment is greater than term assurance..
But what if a person who is 40 years old and he is taking a 30 year term assurance/30 year pure endowment.. In this case the chances of person being died in that 30 years is definitely high than his survival upto 30 years..so in this case I think that for sure the premium for term assurance will be higher than pure endowment. What u guys think?? If not den do let me know the reason.
Thank you
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