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Some Child Insurance Myths Busted

Published On Jan 25, 2022 11:00 AM By InsuranceDekho

A parent's primary responsibility is to make sure that their child receives financial support from their parents in order to achieve his or her objectives and dreams. The child's ambitions may include not only school and professional opportunities, but also interesting hobbies and ideas that, if cultivated, have the potential to transform the world. An insurance plan is a complete financial investment that helps you through all of life's major milestones. However, a kid insurance plan is frequently misinterpreted, and the true benefits are overlooked. It's critical to debunk these prevalent misconceptions so that all parents can benefit from these policies.

Some Child Insurance Myths Busted

Common Myths About Child Insurance Plan

The following points attempt to debunk myths and provide a fact check to help people make more informed and responsible decisions:

MYTH 1: Only the child is covered by child insurance.

The most prevalent misunderstanding regarding Child plans is that the life cover is a child. The parent who earns the most money is generally chosen as the life-insured parent, with the Child as the beneficiary. The advantage of such a policy is that it satisfies the child's desires even when the adult is not around.

MYTH 2: The policy only provides a one-time death benefit.

The lump payment will be paid as an insurance death benefit and the policy will be cancelled if the parent dies unexpectedly. The primary substance and appeal of a child's policy is that it contains a Rider Fee Waiver. The potential premiums are forgiven if the spouse dies before the programme begins, and the program continues. This has no influence on the incentives that will be available once the plan is fully implemented. There are various benefits in addition to the lump sum payout made immediately after the insured's death.

MYTH 3: Liquidity Isn't Available in Children's Plans

Child policies can be changed as needed. Traditional/money-back policies, as well as ULIPs, are available for these programs. Annual bonuses in traditional/money back plans will be distributed at predetermined intervals in accordance with the policy's milestones. The ULIP, on the other hand, allows consumers to cancel any payments made for the infant's schooling or any other child-dependent expenses after 5 years.

MYTH 4: Child plans aren't entirely clear.

To offer the policyholder accountability, all expenses are fully stated in ULIPs, which are market-linked child plans. Fund management, administration, and mortality may all be subject to these charges. The policy statement lays forth all of the expenses as well as the amount of the premium paid. As a result, the policyholder receives a monthly asset report that may be reviewed on a regular basis.

Myth 5: It's just good for paying for education.

There is no such requirement. You may use it to help your youngster start a business or pay for his fitness training. A kid insurance plan is linked to education since the investment outperforms inflation over time, provides a corpus fund in the event of a parent's death, and offers ongoing support until the policy period ends.


The following information aims to dispel common misunderstandings concerning child insurance. So think about the facts before making a judgement concerning your children's future. Consider the advantages of getting a kid insurance coverage.

You may also like: How To Purchase The Right Child Plan?

Chief Advantages Of Purchasing A Child Life Insurance 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.

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