A child is a foremost priority for parents. Effective financial planning only aids in a better upbringing. A child insurance plan acts as a security cushion combining the best of insurances and investments.
This ensures there are zero woes in continued education as well as a lump sum life cover on maturity. The bonus of flexible pay-outs at every milestone the child reaches propels the overall growth of a child.
A child insurance plan also covers any kind of financial insecurities from medical expenses to unforeseen events. The question of savings arises where monthly incomes are just not enough to suffice for what education is going to cost in the future.
Child plans are tailored to suit the educational needs based on the financial disposition of the parents as well as the monetary goals.
Trademarks of Child Plan
A big contribution to successful parenting is the right financial planning at the right age. The benefits are plenty. A child insurance plan just provides the financial protection a child needs even during the absence of parents.
Below given are some of the highlights of the best of features:
Lump-sum Cover
The child plan offers protection cover within the ongoing policy term. A child is benefitted from a chunk of the insured fund in times of uncertainty or the death of a parent.
Premium-Waivers
The child is never burdened with premium payments. A bank or financial institution continues to pay on the parent’s behalf thus the policy is in place acting as a financial shield for securing a child’s future.
Withdrawal Benefits
The educational milestones of a child are funded through partial withdrawals depending on several conditions.
Tax Exemptions
A policyholder is subject to several tax exemptions depending on the income tax legislation.
Wealth Amplifiers & Loyalty Add-Ons
Child plans let one enjoy benefits like wealth amplifiers and loyalty add-ons. These aids in growing money without any extra investments.
Higher Rate of Returns
Child plans bestow one the offer of getting more than market expected returns. This beats the risk of fund or interest rate fluctuations.
Premium Payments
Child insurances entail the offer of selecting the method of premium payments. This could be paid off yearly, half-yearly, on quarters, or monthly basis.
Classifying Child Plans
Child insurance policies are based on multiple parameters and have the added advantage of customization to suit needs & priorities.
One Time Premiums
A policy that enlists paying lump sum amount at once as premium. This makes sure the policyholders do not have to worry about future premium payments. Lucrative discounts are offered to attract customers thus reducing the overall premium.
Regular Plans
Regular plans come hoarded with flexibility in terms of paying premiums. This ensures one can choose the term payments as monthly, quarterly, half-yearly to yearly basis.
ULIP
Ulip plan for child constitutes higher coverage on the insured fund, equity contributions, streamlined investments. The benefits are long term which emancipates a child’s future needs. Thus, aiding in the child receiving the assured sum even after the demise of parents.
Traditional Endowments
A traditional plan that boasts of being inclusive of a security cover along with savings. Thereby accumulating funds over longer periods and receiving lump sum money on maturity.
Conclusion
The best conceivable future for a child can be drawn on several factors. This incorporates the necessities wherein one must start saving early. Thereby weighing on the economic variables to get an understanding of the costs and expenses in the foreseeable future. Keeping in traction the inflation and economic burden. Finally choosing the right funds to give your child the wings to fly.