Accelerative Endowment

Published: | Updated: December 28, 2017

Definition - What does Accelerative Endowment mean?

An acceleration endowment is a method of arranging the dividends of a life insurance policy to essentially convert it into an endowment policy. Over time the dividends build up, and the policy allows for the insured to collect a lump sum after a certain amount of time before the policy would normally mature.

Insuranceopedia explains Accelerative Endowment

The main benefit of accelerative endowments is that they give the insured the option to receive a lump sum of money before their death. This is different from other life insurance options that only provide benefits upon the death of the insured. The lump sum allows the insured to make more investments or later earn a fixed income through the purchase an annuity policy. Of course, the insured can also simply keep and use the money as preferred.

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