Salvage your Child's Dreams with Secured Child Plan Insurances
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Being a parent, your life entirely revolves around your children. We do everything to ensure they get the best in their life. A Child Plan is an insurance plan that aids parents to save for their child’s future expenses. It is a combination of both a life insurance plan as well as a savings plan.
How does Child Plan work?
Here, the parent is the insured person, and the child is the beneficiary. The child will get the maturity amount at the end of the policy term during the parent’s demise.
Ideal Reason behind a Child Plan
The main reason behind a child plan is to safeguard a kid’s future in case of the sudden demise of the parent so that they don’t have to struggle during the parent’s absence financially. It is also an ideal way to save for their child’s education and future expenses.
Benefits of a Child Plan
There are many benefits to opting for your child’s plan. Some of the key benefits are as listed below:
- Safe and financial support for your child’s future
- Predetermined periodic pay-outs which aids in short-term and medium-term financial needs
- No worries on premium payment during parent’s premature death
- Collateral security option for a child’s higher education loan
- Acts as an income protector tool for children who start earning during younger age
- Dual tax benefits
Types of Child Insurance Plans
Many child insurance plans are available these days, with various additions and twists that suit your child’s needs. Some of the common ones are as listed:
- Child Endowment Plans
In this plan, your funds are deposited in multiple debt products based on the company’s decision. There is a guaranteed return of money with this, even though the amount isn’t that huge.
Benefits of Child Endowment Plan:
- While most of the investments are subject to market loss, a child endowment plan is less risky in that case. Hence, it is a much safer investment for the family
- Aids to avail better tax benefits in terms of savings or protection
- Guaranteed Return Plans
As the name itself indicates, this plan ensures a guaranteed amount back during the maturity period completion. This is a safe way to save for your child’s future and doesn’t have any risks in it.
Benefits of Guaranteed Return Plans:
- This plan ensures to make provisions for flexible premiums
- Enables you to choose the maturity period based on your child’s age and purpose
Market Linked Plans
Also known as the Unit Linked Insurance Plan(ULIP) comes with an additional feature wherein you invest your money for future financial goals such as a child’s education. It has the dual benefit of saving for your family as well as for their future.
Benefits of ULIP:
- Flexibility wherein it gives you an option of selecting the funds as per needed
- After the lock-in years of 5 years, you will be able to withdraw the money fully or partially
- Enables you to have systematic savings putting aside a part of your income for your child’s education and future
Wrapping Up:
As already discussed above, a child insurance plan aids in saving a part for a child’s education and future expenses after the parent’s death. Every parent must opt for one as early as the child is born. The benefit of early financial planning for children is sure to give better outcomes if invested in schemes with a long-term path.
Keyword: Child Plan
Frequently Asked Questions (FAQs)
- When does a policy lapse?
It usually happens when the policyholder fails to pay the premium even within the grace period. Once a policy is lapsed, it loses all its benefits.
- How to buy an insurance policy?
It can be either done through the preferred company’s online portal or either through the respective sales personnel.
- What happens to the policy if I don’t revive it within the revival period?
Usually, the revival period is for two years. If it isn’t revived during that time, then it stands to be foreclosed and cannot be revived later on.
- What is the expected time for my policy to be issued?
The expected time for the policy to be issued is 15 working days. It might take even a little longer, depending on the medical and non-medical requirements.