Definition of "Endowment"

A life insurance policy that also carries an investment element normally equal or greater than that of the sum assured. Generally used in this country to aid the repayment of mortgages used for house purchase but can also be used as a savings plan. Endowments were once and are still sometimes used by charities to generate income on a regular basis by setting a few of them to mature regularly each year this ensured a regular set amount of income.