Here's What New Parents Need To Know About Insurance
As you become a new parent, a deluge of advice starts to pour in from every Tom, Dick, and Harry. Whether it’s on how to feed your rebellious toddler, how to get crayon marks off the newly painted walls, or how to send them to the best of schools – let’s admit it, the pressure to become and act like a perfect parent starts to feel overwhelming. However, most of the stuff you truly should be concerned with isn’t what people usually tell you to worry about.
Raising a child is not easy; it indeed is financially burdensome. The initial months of sleepless nights over messy diapers are unavoidable. But getting the right insurance, a child plan, early on in the beginning of parenthood will ensure you don’t lose a good night’s sleep providing for your little one right from crib to college.
Why Is Life Insurance for Children a Must-Have?
Children’s insurance is the best gift that you as a parent(s) can think of to give your kids to protect them from any unforeseen financial burden. Sure, you want to live through and celebrate your child’s successes till adulthood and ahead. However, in the face of any sudden unfortunate event, if your child has to make it through without a parent or both – wouldn’t you still wish the best of education, amenities, and lifestyle for them? Life insurance for children does just that.
How Is a Child Plan Different From a Regular Insurance?
A good child plan gives you assured returns on your investments. More important is that the plan continues even if you happen to have a premature death while your little one(s) is still dependent on you. Yes, the insurer not only disburses regular funds to cater to their financial needs, but they also pay the premium that you would have to pay if alive to carry the plan on in your child’s name long after you’re gone!
At best, if you outlive the term and stay around to see them hitting all their important milestones in life, you still get a considerable corpus as maturity benefit to ensure they get the maximum financial leverage to augment their lives.
Tax Saving for Whichever Parent Opts to Pay the Premium
When you pay the premiums for children’s insurance, you can get up to Rs. 1.5 lakhs deduction under Section 80C of the Income Tax Act. Further, a critical illness, disability, or hospitalization benefit add-on would save taxes as per Section 80D of the Act. Taxation laws keep getting amended, which might tweak these limits in the future.
A Few Things to Remember About Children Insurance
- It is always recommended that you get a child plan when your child is still a minor, as the premium would be considerably lower, and you can reap greater benefits from longer compounding.
- While this is a claim no one ever hopes to encash, it’s nevertheless imperative that you also check and compare the claims ratio when choosing your insurer. The claims ratio signifies the percentage of claims admitted by the insurance provider in the past in relation to the number of claims raised.
- Getting into an insurance contract requires you to answer many questions about the insured or the beneficiary, including age, habits, lifestyle, and health conditions. The fact that you should be absolutely transparent and truthful about these details cannot be emphasized more. This might result in partial dismissal of the claim amount in the future. Really the last thing you want is your child to get deprived of the fund that you’ve amassed for such a long time.
In Conclusion
Go ahead and secure the future of your little bundle of joy while they are still learning to take their first steps. Edelweiss Tokio is renowned for its insurance policies. Read up on their children’s insurance to know more!
