subject: Why You Must Invest In Child Insurance Plans [print this page] Parents are extremely careful and emotional with anything that has got to do with their kids. Be it selection of a school, or sending their kids for an extracurricular activity, they are very diligent. However, in todays times every parent is caught up with daily chores and is leading an extremely busy life. Therefore, somewhere parents tend to ignore the necessity of figuring out appropriate investment plans for their children. It is very important, that parents start investing in products like child insurance plans, as early as possible.
Most life insurance companies offer attractive child insurance plans and these are designed with the motive of saving for your childs future. Child plans have an additional benefit over a life insurance plan, as not only is the nominee provided death benefit, but it ensures continuation of premium for the benefit of the child. In addition to this, it helps to take care of rising inflation and in turn, the rising costs of your childs education.
There are plans that help to provide you with funds at pre-fixed intervals, so that the childs financial needs are taken care of, at different phases of his life. Similarly, if a Unit Linked Insurance Policies (ULIP)-linked endowment plan is bought in your child's name, then you can prematurely withdraw 20% of the sum assured after 5 years from the effective date of the policy. Another type of plan available with insurance companies is where you can avail the benefit of premium waiver. In the case of an event of untimely death of a parent, all future premiums are paid in a lump sum, to take back as partial withdrawals during the last five policy years.
The below mentioned steps will help you to invest in one of the plans:
Decide the term of the plan, based on when your child will need the money
Accordingly, calculate the money needed
Decide the minimum life cover needed, as per your lifestyle
Compare all the possible policies offered by insurance companies and then decide which one to invest in
Hence, there are various plans you can opt for, depending on your requirement and specification. So, go for one of the investment plans and gift your child a beautiful future!
by: Sudeep Desai
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