Things You Should Know About Child Life Insurance Plans
Published On Feb 11, 2022 10:20 AM By InsuranceDekho
Table of Contents
Child insurance is a form of life insurance policy that provides policyholders with both life protection and investment opportunities. With the help of this insurance plan, one can protect their children's future while also building an investment corpus to assist their children in meeting major life goals. In the case of a kid insurance policy, the parent is the policyholder, while the child is the beneficiary. The rising expense of higher education has become a source of concern for all parents; therefore, in light of the scenario, it has become an urgent requirement for all parents to guarantee their child's future by purchasing a child insurance plan.
Things To Consider Before Purchasing A Child Life Insurance Policy
The following are some essential details about kid insurance that every parent should be aware of:
Presents a variety of advantages
A kid insurance plan not only assists the policyholder in creating a financial corpus for their child's education, but it also has a number of other advantages. Under certain of these insurance plans, a policyholder has the option of making a partial withdrawal, which can assist them to deal with financial problems. Furthermore, some of these insurance plans include premium waiver options, in which the insurance company waives any remaining premium payments in the event of the policyholder's untimely death during the plan's term. As a result, even if the parent is not there, the child is financially protected by this plan.
A child insurance plan typically has two pay-out options: lump sum and ongoing payments. Under the lump sum pay-out option, the policyholder receives a large sum of money all at once in order to take care of your child's major long-term plans, such as higher education and marriage, which both require a significant sum of money. While a regular payment option ensures that a child's urgent needs are covered, such as learning new skills, paying admission fees for new academic sessions, and so on.
Different Kinds of Child Insurance Plans Are Available
The policyholder can obtain a kid insurance plan as an endowment plan or as a unit-linked insurance plan (ULIP). As a form of savings vehicle, a child endowment plan typically gives fixed guaranteed returns. A portion of a Unit Linked Child Insurance Plan is invested in the market to assist the policyholder in building finances. This strategy essentially assists the policyholder in generating inflation-adjusted returns. One might select one of the above-mentioned programmes based on their risk tolerance and preferences.
Premium Waiver Benefit
Child Life Insurance policies frequently include a 'Waiver of Premium' benefit, which means that if the life assured, i.e. the child's parent, dies during the policy term, all future premiums are waived and the policy continues. This way, you can ensure that your child has sufficient financial resources to achieve their objectives
Prior to obtaining a child insurance plan, it is critical to double-check the sum assured. Education costs are rapidly rising, and by the time your child progresses from high school to university, you will need a large sum of money. As a result, you must choose a guaranteed sum that will financially assist your child in pursuing their further education.
Also Read: Understand Everything About LIC's Girl Child Policy.
How To Purchase Child Plans Online In India?
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.