This type of plan is insurance cum investment plan serving two purposes. One is to provide financial support the child’s future and second is to help them in their life during higher education or marriage. Child plans helps a child in case the insured is deceased, this plan then supports the child financially.
|Child Plans||Entry age||Maximum Maturity age||Minimum Annual Premium||Min Sum Assured|
There are different types of child plans available:
To ensure the child has a better life in terms of securing his/her future, by getting a good education either in the country or aboard, which will make the child independent and financially sound. There are many different plans in the market and one need to review all and fins what is good for their child.
|Child Education Plans||Entry age||Max Maturity age||Policy Term||Min Sum Assured|
|Scenario||Term Plan||Child Plan|
Even with minimum premium payment, child plans are able to provide as much as 10 times the amount paid in the child education plan. This lump sum amount in child education plans can be foremost utilised towards education expenditure. A child education plan is often enough to pay for college education, and even higher education in a foreign country. The money available from a child education plan depends on the terms and conditions of the plan and on the amount one has invested in it by way of premiums.
Child plans also allow the option of withdrawing money during the tenure of the child investment plans. This can be used for medical treatment of the child when he or she falls ill. Such partial withdrawals come in very handy when the child is hospitalised due to an ailment, minor accident or a more serious medical condition. The best child plan helps to reduce the financial burden caused by medical expenditure and such payouts act as an add-on for one's health insurance plan.
Death does not come with invitation and no amount of preparation can leave on ready for such an event. The consequences are more so for the innocent child. The death of the parent(s) causes severe trauma to a child and can leave his or her future hanging by a thread. The insurance company offers a premium waiver if the parent (i.e., the insured) passes away during the policy term of a child plan. The premium waiver benefit often comes built into child plans. If not, one should definitely opt for this rider. The child receives a lump sum amount promised at the time of purchasing the child investment plans and does not have to pay balance premium. The rider enables the policy to continue without any breaks and passes the financial burden of remaining premium to the insurer.
A child plan also protects the income of those children who start earning at a young age. It includes child actors, musicians, artists and performers among others. It provides the advantage of capital appreciation over the long term for the child.
Higher education is expensive, whether one plans to send the child to a private college or university in India or abroad. In fact, international education is significantly more expensive. Child plans come in handy if one intends to secure a loan for higher education as these are allowed to be used as collaterals. They can also be used as collateral for other child-related borrowings