What is Child Plans ?
A child plan provides a guaranteed lump sum on maturity,
while ensuring that kids receive sufficient money at the right time in case of the
parent’s demise. Only a child insurance plan ensures that the child receives a certain
sum of money at the desired age, not earlier or later. The policy pays out even
in case the parents survive and hence acts as a savings cum insurance plan that
addresses the financial needs of the child to meet education, marriage or any other
financial goal. A unique feature of child insurance plans is that in case the parent
dies, the insurer immediately pays the sum assured to the nominees. However, unlike
other plans, the policy continues and the premium is borne by the insurer through
a waiver of premium feature.
Why go for Child Plans ?
Every parent is increasingly aware of the need to save for their kids; doing so
haphazardly could render the effort futile. This is where insurance plans specially
designed to meet this objective come in handy.
- A child insurance plan is a regular premium life insurance product designed to meet
the financial needs of the child; be it higher education, marriage, start to a career
- It provides a cover for their financial needs should something unfortunate happen
to the parent
- It can be purchased on the life of either parent with the child as the nominee.
How to buy Child Plans ?
The premium on this plan is based on the older of the parent’s age.
- Buying this plan online is a cheaper option
- Do add the premium waiver rider with this plan
- Ensure that you can afford payments throughout the term, discontinuing this policy
can prove very costly
This policy is suitable to every parent
- After the birth of a child to start saving early
Premium saving tips
- Buy as early as you can after having a child as you will be younger for premiums
to be lower
- Look for a plan with in-built waiver of premium instead of a rider
Avail tax benefits under Section 80C on the premiums paid
for these policies
Did you know ?
The policy maturity can be timed to meet certain milestone
payments as the child reaches a specific age