As a parent, our child and their future is the priority and having insurance plan aids in financial planning for the child’s requirements and needs for the right age.
Why Should I Buy Child Plan Policy?
When a child attains some specific age like 18 years that time some funds are needed for their prospects so in this scenario a child’s insurance policy assured benefits. So, if your child is 8 years, then it is the perfect time to buys one of the best plans that will mature in 10 years and when the child turns 18 years, the funds can be taken fully or partially.
Feature of Child Insurance Plans
In case of death of parents or in financial difficulties insurance policy acts as a cushion to child.
- Maturity– Maturity period can be chosen according to the child’s age, e.g., after taking into consideration factors- like inflation and interest rate. Parents choose ten years of maturity at time the when the child is 8-year-old. But make many single premium plans that may or may not provide maturity benefits so kindly check the term and conditions of the policy.
- Premium – Most companies have given the option like monthly or quarterly or half-yearly or yearly for the payment of premium, one can also instruct the bank to credit directly from the bank account for the premium payment. Premium amount depends on the maturity of policy or sum assured that you have chosen.
- Tenure – Generally plan is meant for a child up to age 18 or 21, so tenure can be selected from birth until the child reached a defined age.
- Payouts segment– Parents can select if the child gets payment as a yearly installment or in a lump sum, such payout segment help in paying such as college fees, loans, etc.
- Taxation– One can claim deduction under Income Tax Act Section 80C if the premium is paid more than 10% in a year of the basic insured amount.
The benefit of Child Insurance Plans Policy
- Flexibility in periodic payment option
- Tax benefits under Income Tax act under various section
- Secured are available against child insurance plan
- Flexibility in disbursing of the fund on maturity or death
- Premium wavier in the case of demise of insured within the premium collection period
- One can choose between ULIPs (Unit Linked Insurance Plan) and endowment plans
Choosing the Right Child Plan Policy
In the market, there is any company that is offering a different type of plan their basic structure is the same as mentioned above but there are many other technicalities that differentiate products from different companies. One should do proper research on policy for child before selecting. You can visit the (IRDA) Insurance regulatory and development authority of India website to find the detail of the legalize companies and their products, this may be a lengthy process but today’s hard work fruitful in the future.
Alternatively, one can also visit an online website to compare plans side by side.
Best Child Plan Policy in India
HDFC Life Young Star Udaan
This plan is non linked, it helps parents to plan systematically and invest for their children important life events, this plan ensures that every necessity of child are met when the parents are not around
- It is the money-back plan it has multiple variants.
- The customer has the choice of three different types of maturity, based on their need.
- The plan has a wide range of policy terms and premium payment options.
- In the classic wavier variant of the plan, after the death of the policyholder, the future premium need not be paid.
- Despite a limited premium payment term, one can get coverage for the entire policy term.
Under SBI Life – Smart Champ Insurance- this plan ensure that the family is financially protected, the child’s future is secure, and also provides a certain level of flexibility in selecting the premium payment option.
- When the child attains 18 years the benefit will be paid in 4 equal annual installments.
- If the policyholder dies then the sum assured will immediately be waived off and immediately paid off.
- The insurer will get the benefit of (ATPD) Accidental total permanent disability coverage with the insurance policy.
Bajaj Allianz Young Assure Plan
This plan is a traditional, Participating, Limited, and regular Premium payment endowment plan that ensures the family is secure financially
- A special premium rate is offered to a female customer.
- If there is accidental disability or death of the policyholder then comprehensive insurance coverage is offered.
- Guaranteed Maturity Benefit (GMB) or Guaranteed Addition (GA) and bonus are offered to the policyholder to ensure that they receive a good return from the investment.