There are primarily three types of endowment policies:
Guaranteed Endowment Plan: This type of policy offers assured returns at maturity, regardless of market fluctuations. It is ideal for risk-averse individuals seeking stability.
Unit Linked Endowment Plan (ULIP): In this plan, a portion of the premium is invested in market-linked funds. It offers higher potential returns but also carries investment risks.
Non-Participating Endowment Plan: This type does not share profits with policyholders. Premiums are fixed, and returns are predetermined.