Family and Parenting

Child Insurance plans and their Benefits

child insurance plans
Written by Banani Chakraborty

Child insurance plans and their benefits are the most wonderful gift of good parents to their beloved children. New parents always try to do almost everything to secure their children’s future. It is essential for the parents to secure various financial goals for their kid’s better future. Parents will require money mainly for children’s higher education, establishments as well as marriage.

When the parents see that their children are achieving their dreams, it gives them great satisfaction. They feel proud as a parent. By purchasing appropriate child insurance plans they can secure their children’s future.

Parents have to save in such a way that the children may get the necessary amount to fulfill their future goals as stated above. It is another necessary step towards the parent’s role in child development.

Child insurance plans and their benefits: 

Importance of Child Insurance Plans

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In the first place, good parenting is a satisfying involvement for parents. As they see their children are growing healthy and flourishing in their activities, it makes them happy to a great extent.

But, start to think just the adverse. What will happen in their lives if you, as the parent, anyhow fail to nourish their dreams? Or what will be if you cannot provide accurate items for their growth?

Most importantly, these questions haunt all parents when they think of their children’s future and the fulfillment of their dreams.

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What is a child insurance plan?

At first, child insurance policies are a combination of both insurance and investment. These policies ensure future security for the kids. Generally, parents protect and secure their children’s future through these insurance plans.


Some plans pay the amount at a time after attaining a certain age. Other plans provide the payment in parts after attaining a certain age. The amount payable may vary as some plans provide flexibility. The plans are designed to meet various vital milestones of a child.

As devaluation of money is happening due to 7-8% inflation every year and therefore, things are getting costlier day by day. Consequently, it is becoming extremely difficult to save up for the future, particularly for those whose income is not more than sufficient.

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Why buy a child plan?

Simple monthly savings may not meet the rapid growth of higher education expenses. Therefore, you require an investment plan, which generates more return than simple monthly savings. It helps to meet higher education expenditures as it helps to develop funds to meet education expenses.

Additionally, you will get security from the insurance company. Take into account if something happens to a parent or parents, all dreams will be shattered. All future planning will come to a standstill. In case of the sudden death of the guardian, children will get the amount as per their parents opted.

In fact, the cost of higher education is increasing rapidly. It may be engineering or medical college or computer science or management or so on. Moreover, it may happen that things did not go according to their plans. So the parents have to be ready for any annoying incident or problem that may arise in the future.

The importance of child insurance plans:

This is extremely important mainly because if the proposed parent (father or mother) meets an unfortunate death the insured child gets all the benefits in time. Due to the premium waiver benefit, children get the benefits even in their parent’s absence.

 

child insurance plans

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Therefore, child insurance is perhaps the best plan for the children’s future. The parents need proper goal setting for their children’s future. They must learn Savings and their Importance in life.


They also need to have knowledge regarding

Benefits of child insurance plan:

It offers some exciting benefits to the policyholder. It gives not only a comprehensive maturity benefit but also life cover. Therefore, it secures future monetary benefits. The benefits are as follows

Build Corpus for child’s education:

This plan helps parents to build a corpus for their kids. With the help of periodical payment, parents generate a corpus. This lump sum amount helps the child meet his educational expenditure without any stress.

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Funds the child in the absence of parent(s):

The sudden death of the parent(s) is a severe shock to the child. It may ruin or shatter their future. But thanks to the children’s insurance plans. They help the children and serve them financially as per policy terms and conditions.

They will start to save their highest possible amount for the better future of their beloved children. At the same time, it will also lessen their burden to provide them with finance when it is most needed.

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Income Protection for the child:

Some children plan also provide regular income to the children.

Children Life Insurance:

In child plans, insurers provide welfare to the insured child of an individual. A child plan is so beautifully designed that it provides financial support to the child even if the parents meet with an unfortunate death.

Here life insured is generally the parents and the nominee are the minor children, whose details are provided in the policy.

The main purpose of a child insurance plan is education.

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What is a child education plan?

At first, Child education plans are a mix of insurance as well as investment. Parents create funds over a period for their kids. They need a lump sum amount at the time of college education, various technical education, or for higher studies. A child education plan helps to meet the kid’s future financial necessities like higher studies expenses, establishment costs, or marriage expenses.

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Benefits of a child education plan:

At first, a child education plan built a corpus. Parents expense the fund mainly for higher studies or the successful establishment of the child.

Even some plans allow medical expenditures.

Further, it supports the kid’s future even in the absence of parent(s).

Moreover, some plans offer regular income which helps them in the future.

Premium waiver rider also manifests the benefits.

 



 

 

child insurance

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How a child insurance plan secure your child’s future?

These Child policies ensure financial securities for the children’s future.

At first, a child insurance plan offers a combination of insurance and savings in a single plan.

Secondly, it offers the benefits of long-term investment.

Moreover, it secures a child’s future even after the premature death of the parent.

Besides, a Child insurance plan provides financial securities. It finances at some crucial times of a child.

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Common terms of Children Insurance:



You will see some terms with child policies.

Deferment Period-

In child insurance plans, you can see the term deferment period. Generally, insurance coverage of a child starts after he attains 8years of age or after 2 years from the commencement of the policy whichever is earlier.

Vesting Age-

This term means the age of the child when the policy is shifted in the name of the child. Normally, when the child attains 18 years of age, he becomes the policyholder.

Premium Waiver Rider-

This rider states that if anyone of the parents-working father or mother who is the proposer dies, unfortunately, the premium payment will be stopped. But the policy remains in force till the policy term and the insured child will receive all the benefits when it is originally due.

Almost all the insurance companies in the Indian market have Child Education Plans. Before taking a plan first thing and then invest in a suitable plan.

Actually, this will help to secure the children’s future and give us the confidence that nothing can stop our children from dreaming big and will not stop them from fulfilling their ambitions and following their passion.

  • However, read all the documents and information carefully before starting a child insurance plan. We can rely on some Insurance companies in the market.
  • First, we will collect their brochure. Then we will choose wisely what they are offering and what we want. Go and secure our child’s future with the best Child Education Plan. 

Availability of different types of child plans:

Child plans may be endowment plans, money-back plans, regular income plans, or unit-linked insurance plans (ULIP).

Endowment plans generally offer a one-time return after attaining a certain age above 18.   Parents select the maturity age depending on their choice and risk appetite.

Money-back policies provide a certain amount at certain ages.

A regular income plan supplies money at a regular interval.

Unit Linked Insurance Plans invest in markets to help your funds faster accumulation. Child ULIP plans help you generate inflation-adjusted returns. furthermore, there are some unit-linked insurance plans that can help us to accumulate faster funds along with insurance for the future as well. But it involves some risk.

Best child insurance plans:

You may choose Life Insurance Corporation of India(L.I.C.) as they are no. 1 and their policies are so nicely full fill all the purposes of a man.

L.I.C.

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You may choose from the following companies of Child Insurance Plans

SBI Child Education Plan.

ICICI Child Plan

Reliance Child Plan

HDFC Child education Plan

Max Life Child Plan

Aviva Young Scholar Advantage Plan

Max Life Shisha Plus Plan

MetLife College Plan

SBI Life Smart Scholar

Aegon Life Edu Care Advantage

In child insurance plans, insurers provide welfare to the insured child of an individual. A child plan is so beautifully designed that it provides financial support to the child even if the parents meet with an unfortunate death.

Here life insured is generally the parents and the nominee are the minor children, whose details are provided in the policy.

Why You Must Have a Child Insurance Plans:

This is extremely important mainly because if the proposer parent (father or mother) meets an unfortunate death the insured child gets all the benefits in time.

Normally child insurance plans are taken to meet their higher education expenses after attaining 18 years of age to meet higher education expenses in several installments or at the end of the policy term for marriage or business when a lump sum amount is required to meet the purpose.

 

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Ensuring a child’s future is perhaps the most vital role of parents. To maintain this a parent mast, undergo suitable child insurance plans.

Only these types of policies can meet the demand for a huge amount of money after attaining a certain age of children to fulfill their dream education or in the future they can earn a lot and establish their life.

Final words:

Parents must remember that they must take plan(s) suitable for their child’s future. They cannot ignore their duties. Choose the plans judiciously. There are so many policies. Read them well and then select. Contact a quality insurance advisor who can guide you properly.

Now pay the premium and start the plan. You require motivation to continue the policy. Because it is one type of future security for your child.  Child plans are the true friend of a child if taken cautiously and at the right time. It will be part of your live life to the fullest. It will add not only to your self-esteem but also to your happiness.

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Banani Chakraborty

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