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In Terms Of Child Plans, Myth Vs. Reality

Updated On Mar 27, 2022

You are extremely concerned about the happiness of your child or children, and you will go to great measures to ensure that they have the happiness they deserve. You provide them with amenities such as comfort, education, and a high-quality lifestyle. You may, however, overlook the relevance of preparing how they will manage their money if we are not present. Furthermore, the rising cost of schooling may cause you to be concerned about the future. A robust child life insurance policy enters the picture, providing you with total financial protection for your child's future. There are several Child life insurance policies on the market, but they are also riddled with falsehoods. So, before you buy any of them, let's dispel some myths and disclose the truth behind them so you can make an informed selection.

5 Child Insurance Plan Myths and Facts

The majority of individuals have quite different perspectives about the child plan. The five most common fallacies concerning child planning, as well as the truth behind them, are as follows:

Myth 1: A child's life insurance is the sole thing that will safeguard him or her.

Reality: Most child life insurance policies cover the income-earning parent's life rather than the child's. The advantages provided to allow the child's dreams to be realised even when the parents are not around.

Myth 2: When an insured parent dies, the death benefit is paid out in a lump sum and is insufficient to fulfil the child's future requirements.

Reality: Many child life insurance policies have Family Income Benefit provisions, which ensure that the family receives continual payments (in addition to a lump sum payout upon death) to ensure that the child's educational needs are met.

Myth 3: Inflation is not considered while designing Child plans. As a result, the reimbursements will be insufficient to cover the child's tuition.

Reality: Market-related Plans for children's lives Invest your money in a fund of your choice to maximise your profits. Some plans have Guaranteed Loyalty Additions, which add a set percentage of fund value to your investment fund on an annual basis after a particular number of years. These characteristics help you to grow more swiftly.

Myth 4: If you buy a Child plan, your money is locked in for the life of the policy and cannot be removed in instalments.

Reality: Kid plans can be modified. After completing a 5-year term in a market-linked plan, you can make partial withdrawals.

Myth 5: Child care arrangements aren't always evident.

Reality: All aspects of a market-linked Child plan are openly described. You will receive documentation and holdings statements on a regular basis, which will allow you to keep track of your investment.


When it comes to purchasing a child's life insurance policy, don't rely on word of mouth. Child plans come in a variety of shapes and sizes, and they may help you save for your child's future. They make certain that the rising expense of school does not stifle their ambitions. These are long-term savings plans, and the majority of them include a combination of investing and insurance alternatives.

Also read - The LIC policy For Girl Children In India Is Something You Should Be Aware Of.

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.

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