Planning to Purchase Child Life Insurance? Know All About Child Life Insurance Plans

Child Plans come with the dual benefit of life insurance and investment. This policy allows the life assured to secure their children’s financial future. While simultaneously building up an investment corpus to help them meet their major plans. In a child insurance plan, the parent is the life assured while the child is the nominee.

Increasing educational costs is overwhelming and you might have already started to save and plan for your child but sometimes, the savings that parents already make are not sufficient. They do not get you ready for the unfortunate and unforeseen events that may occur in your child’s life in the future. Your savings might not provide you with medical benefits while a child plan covers the life of your child along with securing their future.

Common Features Of Child Life Insurance Plans

Different child plans offered by different insurers provide you with various benefits to help you save and grow money for the future of your child. Although every plan is different, some common advantages of investing in child plans are -

1. Wide Range of Benefits

Child plans help you create a corpus for your child’s education. These plans have various other benefits too. Some plans allow partial withdrawals to help you to address any financial emergency. Some of these plans offer waivers of premiums. The insurer pays off the future premium if the parent or the guardian happens to accidentally die so that the policy does not end. This way the plan ensures financial protection of the child’s future even in your absence. These plans can be used as collateral assets while trying to avail of a loan.

Must Read: 5 Most Frequently Asked Question for Child Life Insurance Plans

2. Availability of Different Types of Child Plans

There are unit-linked (ULIP) and endowment child plans. ULIPs invest in markets to help your savings grow. Child endowment plans usually provide you with fixed guaranteed returns. They are saving instruments. Considering your risk appetite you can pick.

3. Choice of Pay-out

Child insurance plans provide you with two types of pay-out options being lump sum and regular. Lump-sum payouts give you a high return at once to invest in major long-term goals of your child, for instance, higher education, and marriage. Regular payouts ensure the short-term needs of your child such as admission fees.

Some Important Things To Remember

Listed below are a few important things to remember before investing in a child life insurance plan -

• Look at the sum assured of different plans, compare them with each other and choose a plan that suits your requirement.
• You must look to save at least double the amount you think it would cost for your child to pursue their educational goals.
• Look for plans that suit your current financial situation comfortably. Do not try to stretch beyond what you can invest.
• Choose a plan for your child where you can financially be comfortable with other necessities of your life too. 

Conclusion

In conclusion, child plans are very essential to provide your child with a financially strong foundation to help them fulfill their life goals and pursue their educational goals.

Also Read: Benefits of Waiver of Premium Rider in Child Education Plan

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.