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So far what I understand is its like a cash endowment savings plan. What you put in is the premiums, and the endowment policy return is kind of like up to 2.5% for first 10k, and 1% thereafter. Different from the general endowments where the first 80+% of first year premiums is fees and commissions paid to the insurance Co / agent, this one seems like they give you less return, but the cost is lower (at least they don't eat the 80% of first year premiums). Is my understanding right?
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S$100
MIN. ACC BALANCE
Up to 2% p.a. base return + up to 3.5% p.a. effective returns
RATE OF RETURN
2% p.a. for first S$10K
INTEREST CAP
S$100
MIN. INITIAL PREMIUM
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The other plans you are referring to are participating policies where the money are invested in the par fund. These policies have charges (sales, management, etc) and usually, a lock-in period as the policy is meant for long term investment (10years).
A short term endowment plan is non-participating and functions similar to a fixed deposit.